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THE GEORGE AND HELEN LADD LIBRARY 

BATES COLLEGE 
LEWISTON, MAINE 




BATES COLLEGE 
LIBRARY 



BATES COLLEGE 

LIBRARY 
l-EWiSTON. MAINE 



PUBLIC PAPERS OF THE PRESIDENTS 
OF THE UNITED STATES 



PUBLIC PAPERS OF THE PRESIDENTS 
OF THE UNITED STATES 

Harry S. Truman 

Containing the Public M.essagesj SpeecheSj and 
Statements of the President 

JANUARY I TO DECEMBER 3 I, I95O 

1950 




'-^^^^2^^"^ 



UNITED STATES GOVERNMENT PRINTING OFFICE 
WASHINGTON : I965 

BATES COLLEGE 



LIBRARY 



LEV^flSTON. MAINt 



PUBLISHED BY THE 

OFFICE OF THE FEDERAL REGISTER 

NATIONAL ARCHIVES AND RECORDS SERVICE 

GENERAL SERVICES ADMINISTRATION 



.c^&°^^. 




*/934.* 



For sale by the Superintendent of Documents, U.S. Government Printing Office 
Washington, D.C., 20402 - Price $7.75 (cloth) 



FOREWORD 

THE IMPORTANCE OF this series lies in the extraordinary char- 
acter of the office of President of the United States. 

A President's written and spoken words can command national 
and international attention if he has within him the power to attract 
and hold that attention. It is partly through the use of this power 
that leadership arises, events are molded, and administrations take 
their shape. 

It is this power, quite as much as powers written into the Constitu- 
tion, that gives to the papers of Presidents their peculiar and revealing 
importance. 




PREFACE 

IN THIS VOLUME are gathered most of the public messages and 
statements of the 33d President of the United States that were released 
by the White House during 1950. Similar volumes are available cover- 
ing 1945-1949, and the administrations of Presidents Eisenhower and 
Kennedy. Volumes covering the period January i, 1951-January 20, 
1953, and the period November 22, 1963-December 31, 1964, are under 
preparation. 

This series was begun in 1957 in response to a recommendation of 
the National Historical Publications Commission. An extensive com- 
pilation of the messages and papers of the Presidents, covering the 
period 1789 to 1897, was assembled by James D. Richardson and pub- 
lished under congressional authority between 1896 and 1899. Since 
that time various private compilations were issued, but there was no 
uniform, systematic publication comparable to the Congressional 
Record or the United States Supreme Court Reports, Many Presi- 
dential papers could be found only in mimeographed White House 
releases or as reported in the press. The National Historical Publica- 
tions Commission therefore recommended the establishment of an 
official series in which Presidential writings and utterances of a public 
nature could be made promptly available. 

The Commission's recommendation was incorporated in regulations 
of the Administrative Committee of the Federal Register issued under 
section 6 of the Federal Register Act (44 U.S.C. 306). The Commit- 
tee's regulations, establishing the series and providing for the coverage 
of prior years, are reprinted at page 786 as "Appendix D." 



VII 



Preface 

CONTENT AND ARRANGEMENT 

The text of this book is based on Presidential materials issued during 
1950 as White House releases and on transcripts of news conferences. 
A list of White House releases from which final selections were made 
is pubUshed at page 765 as "Appendix A." 

The full text of President Truman's news conferences is here pub- 
lished for the first time, since direct quotation of the President's replies 
usually was not authorized. Addresses and speeches have been printed 
as actually delivered. 

Proclamations, Executive orders, and similar documents required by 
law to be published in the Federal Register and Code of Federal 
Regulations are not repeated. Instead, they are listed by number and 
subject under the heading "Appendix B" at page 778. 

The President is required by statute to transmit numerous reports 
to Congress. Those transmitted during the period covered by this 
volume are listed at page 785 as "Appendix C." 

The items published in this volume are presented in chronological 
order, rather than being grouped in classes. Most needs for a classified 
arrangement are met by the subject index. For example, a reader 
interested in veto messages will find them listed in the index under 
the heading "veto messages." 

The dates shown at the end of item headings are White House 
release dates. In instances where the date of the document differs 
from the release date that fact is shown in brackets immediately 
following the heading. Other editorial devices, such as text notes, 
footnotes, and cross references, have been supplied where needed for 
purposes of clarity. 

Remarks or addresses were delivered in Washington, D.C., unless 



VIII 



Preface 

otherwise indicated. Similarly, statements, messages, and letters were 
issued from the White House in Washington unless otherwise indicated. 
Original source materials, where available, have been used to pro- 
tect against substantive errors in transcription. In maintaining the 
integrity of the text, valuable assistance was furnished by Dr. Philip C. 
Brooks, Philip D. Lagerquist, and Jerry N. Hess of the Truman Library. 
The planning and publication of this series is under the direction of 
David C. Eberhart of the Office of the Federal Register. The editor 
of the present volume was Warren R. Reid, assisted by Mildred B. 
Berry. Frank H. Mortimer of the Government Printing OflSce 
developed the typography and design. 

Wayne C. Grover 
Archivist of the United States 
Lawson B. Knott, Jr. 
Administrator of General Services 
June 15, 1965 



IX 

41-355—^5 2 



CONTENTS 



Page 

FRONTISPIECE — Photograph courtesy of the Chicago Tribune. 

FOREWORD V 

PREFACE VII 

LIST OF ITEMS XIII 

PUBLIC PAPERS OF HARRY S. TRUMAN I 

Appendix ^— White House Press Releases 765 

Appendix JS— Presidential Documents Published in the Federal 

Register 778 

Appendix C— Presidential Reports to the Congress . . . 785 

Appendix D — Rules Governing This Publication .... 786 

INDEX 789 



XI 



LIST OF ITEMS 



Page 

1 Letter to the Chairman of the President's Water Resources 
Policy Commission. January 3, 1950 i 

2 Annual Message to the Congress on the State of the Union. 
January 4, 1950 2 

3 The President's News Conference of January 5, 1950 11 

Statement by the President on U.S. Policy With Respect to 
Formosa 11 

4 Remarks at the American Federation of Labor's Samuel 
Gompers Centennial Dinner. January 5, 1950 17 

5 Statement by the President on the Midcentury White House 
Conference on Children and Youth. January 6, 1950 18 

6 Annual Message to the Congress: The President's Economic 
Report. January 6, 1950 18 

7 Exchange of Messages With Michael, Orthodox Archbishop 

of North and South America. January 6, 1950 32 

8 The President's News Conference on the Budget. January 7, 
1950 32 

9 Annual Budget Message to the Congress: Fiscal Year 1951. 
January 9, 1950 44 

10 Letter to the U.S. Representative on the United Nations Com- 
mission on the Status of Women. January 10, 1950 107 

11 The President's News Conference of January 12, 1950 107 



xni 



List of Items 

Page 

12 Remarks at a Supper for Democratic Senators and Repre- 
sentatives. January 12, 1950 109 

13 Special Message to the Congress on Synthetic Rubber. Janu- 
ary 16, 1950 no 

14 Remarks at a Dinner Given by the Chairmen and Directors 

of Federal Reserve Banks. January 16, 1950 113 

15 Remarks to a Delegation From the National Emergency Civil 
Rights Mobilization Conference. January 17, 1950 115 

16 The President's News Conference of January 19, 1950 115 

17 Statement by the President on the Rejection by the House of 
Representatives of the Korean Aid Bill. January 21, 1950 120 

18 Special Message to the Congress on Tax Policy. January 23, 
1950 120 

19 Statement by the President on the New 75-Cent Minimum 
Wage Rate. January 24, 1950 127 

20 Exchange of Messages With President Prasad of India. Janu- 
ary 26, 1950 129 

21 Remarks to the Women's Patriotic Conference on National 
Defense. January 26, 1950 129 

22 Statement by the President Upon Issuing Order Providing 
for the Administration of the Mutual Defense Assistance 
Act. January 27, 1950 131 

23 The President's News Conference of January 27, 1950 132 

24 Letter Accepting Resignation of Clark M. Clifford as Special 
Counsel to the President. January 27, 1950 135 



XIV 



List of Items 

Page 

25 Letter to the President of the Senate and to the Speaker of the 
House on U.S. Assistance to Palestine Refugees. January 30, 
1950 136 

26 Statement by the President on the Hydrogen Bomb. Janu- 
ary 31, 1950 138 

27 Telegram to Labor and Management Leaders Proposing a 
Plan for Settling the Coal Industry Dispute. January 31, 1950 138 

28 Letter to the Speaker on the Panama Canal and the Panama 
Railroad Company. February i, 1950 140 

29 The President's News Conference of February 2, 1950 140 

30 Statement by the President on the Crusade Against Heart 
Disease. February 2, 1950 145 

31 Remarks to a Group of Baptist Missionaries. February 3, 1950 146 

32 Statement by the President on Appointing Additional Mem- 
bers of the Committee on Religion and Welfare in the Armed 
Forces. February 8, 1950 146 

33 Letter to the Vice President Urging a Study of the Land and 
Water Resources of the New England States and New York. 
February 9, 1950 147 

34 The President's News Conference of February 9, 1950 149 

35 Letter to the Attorney General Directing Him To Petition for 

an Injunction in the Coal Strike. February 11, 1950 154 

36 Special Message to the Congress Transmitting Report on the 
Training of Veterans Under the Servicemen's Readjustment 
Act. February 13, 1950 155 



XV 



Ltst of hems 

Page 

37 Address Before the Attorney General's Conference on Law 
Enforcement Problems. February 15, 1950 156 

38 The President's News Conference of February 16, 1950 159 

39 Address at the Jefferson-Jackson Day Dinner. February 16, 
1950 164 

40 Letter to Dr. Irvin L. Stewart on the Establishment of the 
President's Communications Policy Board. February 17, 1950 169 

41 Remarks at a Masonic Breakfast on Washington's Birthday. 
February 22, 1950 171 

42 Address on Foreign Policy at the George Washington Na- 
tional Masonic Memorial. February 22, 1950 171 

43 Telegram to Labor and Management Leaders in the Commu- 
nications Industry Urging a 60-Day Truce. February 22, 1950 176 

44 The President's News Conference of February 23, 1950 177 

45 Radio Remarks Opening the Red Cross Campaign. Febru- 
ary 28, 1950 180 

46 The President's News Conference of March 2, 1950 181 

47 Letter to the Chairman, House Committee on Education and 
Labor, on Federal Aid to Education. March 2, 1950 185 

48 Remarks to a Group From the Ninth Annual Science Talent 
Search. March 2, 1950 187 

49 Special Message to the Congress on the Coal Strike. March 3, 
1950 187 

50 Letter to the President of the Senate and to the Speaker of the 
House Transmitting Bill for the Establishment of a Commis- 
sion on the Coal Industry. March 7, 1950 191 

XVI 



Last of Items 

Page 

51 Statement by the President on the Record of the Home 
Owner's Loan Corporation. March 9, 1950 192 

52 The President's News Conference of March 9, 1950 193 

53 Special Message to the Congress Summarizing the New Re- 
organization Plans. March 13, 1950 195 

54 Special Message to the Congress Transmitting Reorganization 
Plans I Through 13 of 1950. March 13, 1950 199 

55 Special Message to the Congress Transmitting Reorganization 
Plan I of 1950. March 13, 1950 203 

56 Special Message to the Congress Transmitting Reorganization 
Plan 2 of 1950. March 13, 1950 204 

57 Special Message to the Congress Transmitting Reorganization 
Plan 3 of 1950. March 13, 1950 204 

58 Special Message to the Congress Transmitting Reorganization 
Plan 4 of 1950. March 13, 1950 205 

59 Special Message to the Congress Transmitting Reorganization 
Plan 5 of 1950. March 13, 1950 205 

60 Special Message to the Congress Transmitting Reorganization 
Plan 6 of 1950. March 13, 1950 206 

61 Special Message to the Congress Transmitting Reorganization 
Plan 7 of 1950. March 13, 1950 207 

62 Special Message to the Congress Transmitting Reorganization 
Plan 8 of 1950. March 13, 1950 207 

63 Special Message to the Congress Transmitting Reorganization 
Plan 9 of 1950. March 13, 1950 207 



XVII 



List of hems 



Page 



64 Special Message to the Congress Transmitting Reorganization 
Plan 10 of 1950. March 13, 1950 208 

65 Special Message to the Congress Transmitting Reorganization 
Plan II of 1950. March 13, 1950 208 

66 Special Message to the Congress Transmitting Reorganization 
Plan 12 of 1950. March 13, 1950 209 

67 Special Message to the Congress Transmitting Reorganization 
Plan 13 of 1950. March 13, 1950 209 

68 Special Message to the Congress Transmitting Reorganization 
Plan 14 of 1950. March 13, 1950 210 

69 Special Message to the Congress Transmitting Reorganization 
Plans 15, 16, and 17 of 1950. March 13, 1950 211 

70 Special Message to the Congress Transmitting Reorganization 
Plan 15 of 1950. March 13, 1950 215 

71 Special Message to the Congress Transmitting Reorganization 
Plan 16 of 1950. March 13, 1950 216 

72 Special Message to the Congress Transmitting Reorganization 
Plan 17 of 1950. March 13, 1950 216 

73 Special Message to the Congress Transmitting Reorganization 
Plan 18 of 1950. March 13, 1950 217 

74 Special Message to the Congress Transmitting Reorganization 
Plan 19 of 1950. March 13, 1950 219 

75 Special Message to the Congress Transmitting Reorganization 
Plan 20 of 1950. March 13, 1950 221 

76 Special Message to the Congress Transmitting Reorganization 
Plan 21 of 1950. March 13, 1950 223 



xvin 



List of Items 

Page 

77 Statement by the President on the National Capital Sesqui- 
centennial Commission. March 15, 1950 227 

78 Letter to the Chairman, House Committee on Foreign Affairs, 
Urging Enactment of the Foreign Assistance Act. March 25, 
1950 228 

79 Letters Regarding Disclosure of Confidential Files on Em- 
ployee Loyalty. March 28, 1950 229 

80 The President's News Conference at Key West. March 30, 
1950 232 

81 Letter to Gordon Gray Regarding His Appointment as 
Special Assistant to the President. April 3, 1950 238 

82 Letter to Senator Tydings Again Refusing to Disclose Con- 
fidential Information on Employee Loyalty. April 3, 1950 240 

83 Special Message to the Congress Upon Approving Bill Relat- 
ing to Cotton and Peanut Acreage Allotments and Marketing 
Quotas. April 3, 1950 242 

84 Special Message to the Congress on the Unemployment Insur- 
ance System. April 6, 1950 244 

85 Remarks of Welcome to the President of Chile at the Wash- 
ington National Airport. April 12, 1950 250 

86 The President's News Conference of April 13, 1950 250 

87 Remarks to Members of the U.S. National Commission for 
UNESCO. April 13, 1950 256 

88 Veto of Bill To Amend the Natural Gas Act of 1938. April 15, 
1950 257 

89 Statement by the President on the Importance of Maintaining 

a Bipartisan Foreign Policy. April 18, 1950 258 

XIX 



List of Items 

Page 

90 Letter to the Speaker on the PHght of Greek Children Ab- 
ducted by Communist Guerrilla Forces. April 19, 1950 259 

91 Statement by the President Upon Signing Bill for the Aid of 
Navajo and Hopi Indian Tribes. April 19, 1950 259 

92 Address on Foreign Policy at a Luncheon of the American 
Society of Newspaper Editors. April 20, 1950 260 

93 Special Message to the Congress Urging Extension of Rent 
Control. April 21, 1950 265 

94 Address at a Dinner of the Federal Bar Association. April 

24, 1950 267 

95 Letter to the Chairman of the President's Committee on 
Religion and Welfare in the Armed Forces. April 27, 1950 272 

96 Statement by the President Announcing Steps Taken To 
Develop a Bipartisan Approach to Foreign PoUcy. April 27, 
1950 273 

97 The President's News Conference of April 27, 1950 274 

98 Letter to Joseph C. Grew and General Lucius D. Clay of the 
National Committee for a Free Europe. May i, 1950 278 

99 Special Message to the Senate Transmitting Treaty With 
Canada Concerning Uses of the Waters of the Niagara River. 
May 2, 1950 279 

100 Special Message to the Congress Transmitting First Report 

of the War Claims Commission. May 3, 1950 281 

loi Message to the United States Technical Conference on Air 

Pollution. May 3, 1950 281 

102 Remarks of Welcome to the Prime Minister of Pakistan at 

the Washington National Airport. May 3, 1950 282 

XX 



List of Items 

Page 

103 Statement by the President on Foreign Policy Legislation 
Following a Meeting With the Chairman of the House 
Foreign Affairs Committee. May 4, 1950 283 

104 Exchange of Messages With the President of Chile. May 4, 
1950 283 

105 The President's News Conference of May 4, 1950 284 

106 Special Message to the Congress on the Problems of Small 
Business. May 5, 1950 288 

107 Letter to the Chairman, Senate Committee on Interior and 
Insular Affairs, on Statehood for Alaska and Hawaii. May 

6, 1950 294 

108 Statement by the President Upon Signing Bill Establishing 

a Uniform Code of Military Justice. May 6, 1950 295 

109 Statement by the President on the Death of President Victor 
Roman y Reyes of Nicaragua. May 7, 1950 295 

no Rear Platform and Other Informal Remarks in Illinois, 

Iowa, and Nebraska. May 8, 1950 296 

111 Address in Lincoln, Nebraska. May 8, 1950 309 

112 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 22 of 1950. May 9, 1950 315 

113 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 23 of 1950. May 9, 1950 316 

114 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 24 of 1950. May 9, 1950 318 

115 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 25 of 1950. May 9, 1950 320 



XXI 



List of Items 

Page 

ii6 Address in Casper, Wyoming. May 9, 1950 321 

117 Rear Platform Remarks in Wyoming. May 9, 1950 327 

118 Address in Cheyenne, Wyoming. May 9, 1950 329 

119 Address in Laramie, Wyoming. May 9, 1950 333 

120 Statement by the President Upon Signing Bill Creating the 
National Science Foundation. May 10, 1950 338 

121 Rear Platform and Other Informal Remarks in Idaho, Ore- 
gon, and Washington. May 10, 1950 339 

122 Address in Pendleton, Oregon. May 10, 1950 358 

123 Telegram to the President of the Senate Concerning Reor- 
ganization Plan 12 of 1950. May 11, 1950 363 

124 Rear Platform and Other Informal Remarks in Washington, 
Idaho, and Montana. May 11, 1950 364 

125 Address at the Dedication of the Grand Coulee Dam. May 

II, 1950 369 

126 Address in Spokane at Gonzaga University. May 11, 1950 374 

127 Rear Platform Remarks in Montana. May 12, 1950 377 

128 Address in Butte, Montana. May 12, 1950 387 

129 Rear Platform and Other Informal Remarks in Montana, 
North Dakota, and Minnesota. May 13, 1950 391 

130 Address in Fargo, North Dakota. May 13, 1950 399 

131 Rear Platform and Other Informal Remarks in Wisconsin. 
May 14, 1950 404 



xxn 



LisS of hems 

Page 

132 Address at the Dedication of the Credit Union National As- 
sociation's Filene House, Madison, Wisconsin. May 14, 1950 405 

133 Radio Remarks Opening the Savings Bond Drive. May 15, 
1950 408 

134 Address in Chicago at the National Democratic Conference 
and Jefferson Jubilee. May 15, 1950 409 

135 Rear Platform Remarks at Cumberland, Maryland. May 16, 
1950 414 

136 Address on the Occasion of the Publication of the First Vol- 
ume of the Jefferson Papers. May 17, 1950 416 

137 The President's New^s Conference of May 18, 1950 418 

Statement by the President Concerning the Proposed Pool- 
ing of the French and German Steel and Coal Industries 418 

138 Remarks at the Armed Forces Dinner. May 19, 1950 423 

139 Remarks at the Democratic Women's National Council Din- 
ner. May 20, 1950 425 

140 Special Message to the Congress Following the Signing of 

the Rivers and Harbors Bill. May 22, 1950 427 

141 Statement by the President in Response to the Report of the 
Committee on Equality of Treatment and Opportunity in 

the Armed Services. May 22, 1950 431 

142 Letters of Appreciation on the Third Anniversary of the 
Greek-Turkish Aid Program. May 22, 1950 432 

143 Message to the Congress Transmitting the Fourth Annual 
Report on U.S. Participation in the United Nations. May 22, 
1950 433 



xxni 



List of Items 

Page 

144 Remarks to Delegates to the Fifth Annual Conference on 
Citizenship. May 23, 1950 436 

145 Remarks to a Group From the Ohio Farm Bureau. May 24, 
1950 437 

146 The President's News Conference of May 25, 1950 438 

147 Joint Declaration With the United Kingdom and France 

on the Arab States and Israel. May 25, 1950 441 

148 Statement by the President on the Joint Declaration on the 
Near East. May 25, 1950 442 

149 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 26 of 1950. May 31, 1950 442 

150 Special Message to the Congress Transmitting Reorganiza- 
tion Plan 27 of 1950. May 31, 1950 443 

151 Special Message to the Congress on Military Aid. June i, 
1950 445 

152 The President's News Conference of June i, 1950 449 

153 White House Statement Announcing the Establishment of 
the President's Commission on Migratory Labor. June 3, 
1950 452 

154 Statement by the President Upon Signing the Foreign Eco- 
nomic Assistance Act. June 5, 1950 453 

155 Address Before the President's Conference on Industrial 
Safety. June 5, 1950 455 

156 Statement by the President Upon Appointing a Committee 

To Review Veterans Hospitals. June 5, 1950 458 



XXIV 



List of hems 

Page 

157 Address at a Dinner of the Better Business Bureaus. June 6, 
1950 458 

158 Remarks at the 91st Annual National Convention of the 
Augustana Lutheran Church. June 7, 1950 463 

159 Commencement Address at the University of Missouri. 
June 9, 1950 464 

160 Rear Platform and Other Informal Remarks in Missouri. 
June 9, 1950 468 

161 Informal Remarks in St. Louis in Connection With the 30th 
Reunion of the 35th Division Association. June 10, 1950 470 

162 Address in St. Louis at the Site of the Jefferson National 
Expansion Memorial. June 10, 1950 473 

163 Remarks to the National Association of Radio Farm Direc- 
tors. June 12, 1950 477 

164 White House Statement Announcing the Estabhshment of 
the Arkansas-White-Red River Basins Inter-Agency Com- 
mittee. June 14, 1950 478 

165 Remarks at the U.S. Marine Corps Base, Quantico, Virginia. 
June 15, 1950 478 

166 Veto of Bill To Define the Application of the Federal Trade 
Commission Act and the Clayton Act to Certain Pricing 
Policies. June 16, 1950 480 

167 Statement by the President Upon Signing Bill Amending 

the Displaced Persons Act. June 16, 1950 483 

168 Memorandum to Department and Agency Heads Request- 
ing Their Cooperation With the Senate Special Crime 
Investigating Committee. June 17, 1950 484 



XXV 



List of Items 

Page 

i6g The President's News Conference of June 22, 1950 485 

170 Veto of Bill Relating to the Promotion of Veterans of World 
War II in the Field Service of the Post Office Department. 
June 23, 1950 487 

171 Address in Baltimore at the Dedication of Friendship Inter- 
national Airport. June 24, 1950 489 

172 Statement by the President on the Violation of the 38th 
Parallel in Korea. June 26, 1950 491 

173 Statement by the President on the Situation in Korea. June 

27, 1950 492 

174 Address at the Laying of the Cornerstone of the new U.S. 
Courts Building for the District of Columbia. June 27, 1950 493 

175 Exchange of Messages With Governor Dewey Concerning 
U.S. Action in Korea. June 27, 1950 496 

176 Remarks to Members of Reserve OflScers Association. June 

28, 1950 496 

177 Address Before the Annual Convention of the American 
Newspaper Guild. June 28, 1950 498 

178 Remarks to the Washington Student Citizenship Seminar. 
June 28, 1950 502 

179 The President's News Conference of June 29, 1950 502 

180 Statement by the President Announcing an Economic Sur- 
vey Mission to the Philippines. June 29, 1950 506 

181 Exchange of Messages With the Presidents of Costa Rica, the 
Dominican Republic, Nicaragua, and Colombia Concern- 
ing the U.S. Decision on Korea. June 29, 1950 507 



XXVI 



List of hems 

Page 

182 Veto of Bill To Amend the Hatch Act. June 30, 1950 509 

183 Veto of Bill To Amend the War Contractors Relief Act. 
June 30, 1950 510 

184 White House Statement Following a Meeting Between the 
President and Top Congressional and Military Leaders To 
Review the Situation in Korea. June 30, 1950 513 

185 Address at Valley Forge at the Boy Scout Jamboree. June 30, 
1950 513 

186 The President's News Conference of July 6, 1950 516 

187 Statement by the President Regarding a Request for Supple- 
mental Appropriations for the Atomic Energy Commission. 
July 7, 1950 519 

188 Statement by the President Upon Issuing Order Averting a 
Railroad Strike. July 8, 1950 519 

189 Statement by the President Announcing the Designation of 
General MacArthur To Lead the Allied Military Forces in 
Korea. July 8, 1950 520 

190 Letter to the Speaker on the Need for an Expanded Truth 
Campaign To Combat Communism. July 13, 1950 521 

191 The President's News Conference of July 13, 1950 522 

192 Letters to Agency Heads on the Need for Restricting Hous- 
ing Credit. July 18, 1950 525 

193 Special Message to the Congress Reporting on the Situation 

in Korea. July 19, 1950 527 

194 Radio and Television Address to the American People on 

the Situation in Korea. July 19, 1950 537 



xxvii 



List of Items 

Page 

195 Statement by the President on the Appointment of Charles 
M. Spoflord as Deputy U.S. Representative to the North 
Atlantic Council. July 20, 1950 542 

196 Letter to Agency Heads Directing a Review of Government 
Programs. July 21, 1950 543 

197 Message to Dr. Daniel A. Poling, President of the World's 
Christian Endeavor Union. July 21, 1950 544 

198 Statement by the President on the Death of Mackenzie King. 
July 23, 1950 544 

199 Statement by the President on Reporting Information Re- 
lating to Espionage, Sabotage, and Subversive Activities. 
July 24, 1950 545 

200 Letter to the Chairman, Senate Committee on Finance, on 

the Need for an Increase in Taxes. July 25, 1950 545 

201 Statement by the President Upon Signing Bill Continuing 

the Military Aid Program. July 26, 1950 547 

202 Special Message to the Congress: The President's Midyear 
Economic Report. July 26, 1950 548 

203 The President's News Conference of July 27, 1950 560 

204 Letter to the Speaker Transmitting Supplemental Estimate 

of Appropriations for Military Assistance. August i, 1950 564 

205 Letter to Committee Chairmen on the Defense Production 
Bill. August I, 1950 566 

206 The President's News Conference of August 3, 1950 568 

207 Special Message to the Congress on the Internal Security of 

the United States. August 8, 1950 571 



xxvni 



List of Items 

Page 

208 Remarks to the President's Committee on National Employ 

the Physically Handicapped Week. August 9, 1950 577 

209 The President's News Conference of August 10, 1950 579 

210 Veto of Bill Relating to the Census in South Parkersburg, 
West Virginia. August 11, 1950 583 

211 Message to President Syngman Rhee on the Second Anni- 
versary of the Republic of Korea. August 14, 1950 584 

212 Statement by the President on the looth Anniversary of the 
Death of General Jose de San Martin. August 16, 1950 584 

213 Letter to the Chairman, Senate Committee on Public Works, 

on the Federal-Aid Highway Bill. August 17, 1950 585 

214 The President's News Conference of August 17, 1950 586 

215 Letter to the President of the Senate on the Defense Produc- 
tion Bill. August 185 1950 589 

216 Veto of Bill To Amend the War Contractors Relief Act. 
August 21, 1950 590 

217 The President's News Conference of August 24, 1950 592 

218 Statement by the President Upon Nominating Walter J. 
Donnelly as Minister and U.S. High Commissioner for 
Austria. August 24, 1950 595 

219 Statement by the President Upon Nominating U.S. Repre- 
sentatives to the Fifth Session of the U.N. General Assembly. 
August 24, 1950 596 

220 Letter to the Speaker on the Appropriation for Foreign Aid. 
August 25, 1950 596 



XXIX 



List of Items 

Page 

221 Statement by the President Upon Issuing Order Taking Con- 
trol of the Nation's Railroads. August 25, 1950 597 

222 Letter to the Chairman, Senate Committee on Foreign Rela- 
tions, Urging Early Ratification of the Genocide Convention. 
August 26, 1950 598 

223 Letter to Ambassador Warren Austin Restating the U.S. 
Position on Formosa. August 27, 1950 599 

224 Statement by the President Upon Signing the Social Security 
Act Amendments. August 28, 1950 600 

225 Letter to Committee Chairmen on Universal Military Train- 
ing. August 29, 1950 601 

226 Message to General MacArthur Regarding the Withdrawal 
of the General's Message to the Veterans of Foreign Wars. 
August 29, 1950 602 

227 Letter to Senator Flanders on the Appropriation for the 
Campaign of Truth. August 30, 1950 602 

228 Statement by the President: Labor Day. August 31, 1950 604 

229 Letter to the General Chairman of the President's Highway 
Safety Conference. August 31, 1950 605 

230 The President's News Conference of August 31, 1950 606 

231 Letter to the Ambassador of Chile on the U.S. Excise Tax on 
Copper. September i, 1950 608 

232 Radio and Television Report to the American People on the 
Situation in Korea. September i, 1950 609 

233 Veto of Bill Relating to Spanish-American War Veterans. 
September 6, 1950 614 



XXX 



Ust of Items 

Page 

234 Statement by the President Upon Signing the General Ap- 
propriation Act. September 6, 1950 616 

235 Letters to the Commandant of the Marine Corps League and 

to the Commandant of the Marine Corps. September 6, 1950 617 

236 Statement by the President Upon Signing Bill Regarding 
Marine War-Risk Insurance. September 7, 1950 618 

237 Remarks to Members of the Marine Corps League. Septem- 
ber 7, 1950 619 

238 The President's News Conference of September 7, 1950 619 

239 Remarks to the National Citizens' Committee for United 
Nations Day. September 7, 1950 623 

240 Statement by the President Upon Signing Order Concern- 
ing the Point 4 Program. September 8, 1950 623 

241 Veto of Bill To Amend the Nationality Act of 1940, as 
Amended. September 9, 1950 624 

242 Statement by the President Upon Approving an Increase in 
U.S. Forces in Western Europe. September 9, 1950 626 

243 Radio and Television Address to the American People Fol- 
lowing the Signing of the Defense Production Act. Sep- 
tember 9, 1950 626 

244 Statement by the President Upon Signing the Budget and 
Accounting Procedures Act. September 12, 1950 631 

245 Letter Accepting Resignation of Louis Johnson as Secretary 

of Defense. September 12, 1950 632 

246 Letter to Committee Chairmen Transmitting Bill To Permit 
General Marshall To Serve as Secretary of Defense. Sep- 
tember 13, 1950 633 

XXXI 



List of Items 

Page 

247 Remarks to the National Association of Postal Supervisors. 
September 13, 1950 634 

248 Statement by the President Upon Signing Bill Establishing 

a New Grand Teton National Park. September 14, 1950 635 

249 Letter to Senator Thomas on the Distribution of Surplus 
Perishables to Welfare and ReUef Agencies. September 14, 
1950 636 

250 The President's News Conference of September 14, 1950 637 
Statement by the President on the Japanese Peace Treaty 637 

251 Special Message to the Congress Transmitting a Report of 

the National Security Resources Board. September 18, 1950 641 

252 Letter to Committee Chairmen on the Wherry Amendment 
to the Supplemental Appropriations Bill. September 20, 
1950 641 

253 The President's News Conference of September 21, 1950 643 

254 Veto of the Internal Security Bill. September 22, 1950 645 

255 Recorded Address for Broadcast on Democratic Women's 
Day. September 27, 1950 653 

256 Memorandum of Disapproval of Bill Relating to a Claim of 
the Board of County Commissioners of Sedgwick County, 
Kansas. September 28, 1950 655 

257 Memorandum of Disapproval of Bill To Amend the Mer- 
chant Ship Sales Act of 1946. September 28, 1950 656 

258 The President's News Conference of September 28, 1950 657 

259 Memorandum on the Need for Protecting Free Enterprise 
During the Defense Emergency. September 29, 1950 661 

XXXII 



List of Items 

Page 

260 Message Congramlating General MacArthur on the Liber- 
ation of Seoul. September 29, 1950 662 

261 Letter to the Vice President on the Need for Repatriating 
Displaced Greek Children. September 29, 1950 663 

262 Radio Remarks Opening the Community Chest Campaign. 
September 29, 1950 663 

263 Remarks Upon Awarding the Congressional Medal of 
Honor to Maj. Gen. William F. Dean. September 30, 1950 664 

264 Statement by the President on His Forthcoming Meeting 
With General MacArthur. October 10, 1950 665 

265 Letter Concerning the Establishment of an Interagency 
Committee To Study the Resources and Development of 
New England and New York. October ii, 1950 666 

266 Remarks in St. Louis at the Installation of Mary Jane Tru- 
man as Worthy Grand Matron, Order of the Eastern Star 

for Missouri. October 11, 1950 669 

267 Remarks in Pearl Harbor at the Commissioned Officers 
Mess. October 13, 1950 670 

268 Statement by the President on His Meeting With General 
MacArthur at Wake Island. October 15, 1950 672 

269 Address in San Francisco at the War Memorial Opera House. 
October 17, 1950 673 

270 The President's News Conference of October 19, 1950 679 

271 Address in New York City Before the United Nations Gen- 
eral Assembly. October 24, 1950 683 

272 Remarks to Members of the National Guard Association. 
October 25, 1950 687 

41-355—65 3 XXXIII 



List of Items 

Page 

273 The President's News Conference of October 26, 1950 689 

274 Letter to General Geoffrey Keyes, Retiring U.S. High Com- 
missioner in Austria. October 30, 1950 692 

275 Remarks in Arlington Cemetery at the Unveiling of the 
Statue of Sir John Dill. November i, 1950 693 

276 Statement by the President on the Death of George Bernard 
Shaw. November 2, 1950 694 

277 Message to the Governor of Puerto Rico Regarding the 
Recent Uprisings. November 2, 1950 694 

278 The President's News Conference of November 2, 1950 694 

279 Address in Kiel Auditorium, St. Louis. November 4, 1950 697 

280 Remarks in Independence at the Liberty Bell Luncheon. 
November 6, 1950 703 

281 Address in Independence at the Dedication of the Liberty 
Bell. November 6, 1950 704 

282 Statement by the President in Response to the Gray Report 

on Foreign Economic Policy. November 12, 1950 707 

283 Letter to the Chairman, Civil Service Commission, Upon 
Signing Order Establishing Special Personnel Procedures in 
the Interest of the National Defense. November 13, 1950 708 

284 Letter to Committee Chairmen on Taxation of Excess 
Profits. November 14, 1950 709 

285 Statement by the President Urging Support of the CARE- 
for-Korea Campaign. November 14, 1950 710 

286 Statement by the President on the Christmas Seal Campaign. 
November 16, 1950 711 



XXXIV 



List of Items 

Page 

287 The President's News Conference of November 16, 1950 711 

. . Statement by the President on the Chinese Intervention in 
Korea 711 

288 Memorandum Limiting the Number of Supergrade Posi- 
tions in Defense Agencies. November 21, 1950 716 

289 Letter to the Chairman, Advisory Board on International 
Development, on Foreign Economic Policy. November 24, 
1950 717 

290 Letter to Committee Chairmen on Aid to Yugoslavia. No- 
vember 24, 1950 718 

291 Letter to the President of the Senate on Statehood for Hawaii 
and Alaska. November 27, 1950 719 

292 Letter to Committee Chairmen Recommending Extension 

of Rent Control. November 27, 1950 720 

293 Special Message to the Congress Urging Legislation Author- 
izing Further Assistance to Yugoslavia. November 29, 1950 721 

294 Statement by the President on the Advisory Board on Inter- 
national Development. November 29, 1950 723 

295 The President's News Conference of November 30, 1950 724 
Statement by the President on the Chinese Invasion in Korea 724 

296 Special Message to the Congress Requesting Additional Ap- 
propriations for Defense. December i, 1950 728 

297 Statement by the President Making Public a Report Entitled 
"The Military Chaplaincy." December i, 1950 732 

298 Letter to the President of the Senate and to the Speaker of 
the House on Vocational Rehabilitation of Disabled Vet- 
erans. December 4, 1950 732 

XXXV 



List of hems 

Page 

299 Address Before the Midcentury White House Conference 

on Children and Youth. December 5, 1950 733 

300 Statement by the President on the Death of Charles G. Ross. 
December 5, 1950 737 

301 Joint Statement Following Discussions With the Prime Min- 
ister of Great Britain. December 8, 1950 738 

302 White House Statement Concerning a Meeting With the 
Congressional Leaders To Discuss the National Emergency. 
December 13, 1950 741 

303 Radio and Television Report to the American People on the 
National Emergency. December 15, 1950 741 

304 Proclamation 2914: Proclaiming the Existence of a National 
Emergency. December 16, 1950 746 

305 Statement by the President on Secretary Acheson's Attend- 
ance at the Council Meetings of the North Atlantic Treaty 
Powers. December 17, 1950 747 

306 Statement by the President Making Public a Report by the 
Water Resources Policy Commission. December 17, 1950 748 

307 Letter to the President of the Senate and to the Speaker of 
the House Asking for Additional Emergency Legislation. 
December 18, 1950 749 

308 Message to the Secretary of State Designating General Eisen- 
hower as Supreme Allied Commander, Europe. Decem- 
ber 19, 1950 750 

309 The President's News Conference of December 19, 1950 751 
. . Statement by the President in Support of Secretary Acheson 751 



XXXVI 



L/V/ of Items 

Page 

310 Letter to General Eisenhower on His Designation as Su- 
preme Allied Commander in Europe. December 19, 1950 754 

311 Statement by the President Following a Report by Secretary 
Acheson on His Meeting With the Ministers of the North 
Atlantic Treaty Nations. December 21, 1950 755 

312 Remarks in Kansas City at a Dinner of the Knights of the 
Red Cross of Constantine. December 22, 1950 756 

313 Remarks in Kansas City at a Luncheon for the Press. De- 
cember 23, 1950 757 

314 Remarks in Grandview, Missouri, at a Meeting of the Order 

of the Eastern Star. December 23, 1950 758 

315 Remarks at the Dedication Services of the Grandview Bap- 
tist Church. December 24, 1950 758 

316 Recorded Message for Broadcast on World Day of Prayer. 
December 24, 1950 759 

317 Address Recorded for Broadcast on the Occasion of the 
Lighting of the National Community Christmas Tree on the 
White House Grounds. December 24, 1950 759 

318 The President's News Conference of December 28, 1950 760 

319 Statement by the President Upon Signing Bill Amending 

the Clayton Act. December 29, 1950 763 

320 Letter to the President of the Senate and to the Speaker of 
the House Recommending the Posthumous Appointment of 
General Walker to the Grade of General in the Army of the 
United States. December 29, 1950 763 



XXXVII 



Hany S. Truman 
1950 



I Letter to the Chairman of the President's Water Resources 
Policy Commission. January 3, 1950 



Dear Mr, Coo\e: 

For more than a century, the Federal Gov- 
ernment has played a vital role in harnessing 
our water resources and converting them to 
the beneficial and productive use of the 
Nation. 

Over this period our v^ater resources pol- 
icies have been constantly modified and ad- 
justed to meet the emerging needs of our 
complex and dynamic society. It has not 
alv^^ays been possible, however, to decide in- 
dividual changes in policy in the light of 
broad national objectives. Frequendy, new 
policies which have been developed to meet 
specific situations or to solve particular so- 
cial and economic needs existing at the time 
have produced inconsistencies in our na- 
tional water resources policies. 

Within the past several years the need for 
careful review and reappraisal of our na- 
tional water resources policies and related 
land use problems has become increasingly 
apparent. On several occasions, during the 
recent session of Congress, I called attention 
to the need for developing a consistent and 
comprehensive policy with regard to our 
whole water resources program. In many 
cases, piece-meal or partial approaches to 
a problem as broad as water resources de- 
velopment tend to confuse, rather than clar- 
ify, many of the basic, underlying issues. 
It is essential in my judgment that a compre- 
hensive study and review be made of all 
existing water resources legislation and pol- 
icies and that recommendations be made in 
the full knowledge of national needs and 
objectives. 

Therefore, I am creating by Executive 
order a temporary Water Resources Policy 
Commission of seven members to study and 
to make recommendations to me on the pol- 



icies which should be followed by the Fed- 
eral Government in fulfilling its proper 
responsibilities for the development, conser- 
vation and use of the Nation's water 
resources. 

I am asking you to serve as chairman of 
this Commission. Because of the need for 
early action in the field of water resources 
development, I am requesting the Commis- 
sion to submit its final report to me not later 
than December i, 1950. 

In asking you and your fellow members 
of the Commission to undertake this highly 
diflScult assignment, I cannot stress its im- 
portance too gready. 

The Federal Government already has a 
substantial investment in existing water re- 
sources improvements; in recent years we 
have been adding to this investment at a rate 
of more than $1 billion annually. These 
facts alone make it imperative that indi- 
vidual projects be properly related to the 
total water resources program, that they be 
undertaken in logical and orderly sequence 
and that they be scheduled to conform to 
fiscal and other national considerations. It 
is even more important, however, that the 
policies underlying these programs be 
soundly conceived in terms of national needs 
and objectives and that they are adopted 
in the light of our goal of a stable and ex- 
panding national economy. 

While the number of individual issues in 
the water resources field is large, I hope that 
the Commission will devote its attention to 
major areas of immediate importance and 
to those special aspects of resource develop- 
ment programs which have a major im- 
mediate effect on the well-being and proper 
functioning of the Nation's economy. 

The Executive order establishing the 



41-355—65- 



[i] Jan. 3 



Public Papers of the Presidents 



Water Resources Policy Commission states 
that the Commission shall give consideration 
in particular to (a) the extent and character 
of Federal Government participation in 
major water resources programs, (b) an 
appraisal of the priority of water resources 
programs from the standpoint of economic 
and social need, (c) criteria and standards 
for evaluating the feasibility of such projects, 
and (d) desirable legislation or changes in 
existing legislation. 

These all represent areas in which there 
is pressing need for clarification of our na- 
tional policies and responsibilities. 

In requesting the Commission to under- 
take this highly difficult and important as- 
signment, I recognize that it will not be pos- 
sible to formulate recommendations on all of 
the current issues before us in time for con- 
sideration in the forthcoming session of the 
Congress; however, much basic work has 
already been done within the Government 
and elsewhere with respect to many issues 
involved in our water resources program. It 
is my hope, therefore, that it will be possible 
for the Commission to submit interim recom- 
mendations to me on some of the more ur- 
gent issues which have been raised in order 
that specific proposals can be submitted to 
the Congress in time for action this year. 

As you know, the Commission on the Or- 
ganization of the Executive Branch of the 
Government has made a detailed and com- 
prehensive study of the organizational is- 
sues involved in the water resources field. 



The proper allocation of functions among 
agencies, the means for coordinating their 
efforts and the merits of various alterna- 
tives for coordination of river basin develop- 
ment programs are now under active con- 
sideration in the Executive Branch. I have 
already made certain recommendations to 
the Congress in these areas and expect to 
transmit others during the coming months. 
While problems of organization are closely 
related to the development of consistent poli- 
cies in the field of water resources, I am re- 
questing your Commission to confine its 
recommendations to the questions of policy 
set forth in the Executive order together with 
related legislation. 

Very sincerely yours, 

Harry S. Truman 

[Honorable Morris L. Cooke, St. Georges Road, 
Mt. Airy P.O., Philadelphia 19, Pennsylvania.] 

note: The President's Water Resources Policy Com- 
mission was established by Executive Order 10095 
of January 3, 1950 (3 CFR, 1 949-1 953 Comp., p. 
291). 

On the same day the President appointed the fol- 
lowing members: Morris L. Cooke, engineer, Phila- 
delphia, Pa., chairman; R. R. Renne, president, 
Montana State College; Lewis W. Jones, president. 
University of Arkansas; Gilbert White, president, 
Haverford College; Samuel B. Morris, Department 
of Water and Power, Los Angeles, Calif.; Paul S. 
Burgess, dean. College of Agriculture, University of 
Arizona; and Leland D. Olds, New York City. 

The Commission's report was contained in three 
volumes. Volume i, entided "A Water Policy for 
the American People (General Report)," was sub- 
mitted to the President on December 11, 1950 (see 
Item 306). 



2 Annual Message to the Congress on the State of the Union. 
]anuary 4, 1950 

[ As delivered in person before a joint session ] 



Mr. President, Mr. Speaker, Members of the 
Congress: 

A year ago I reported to this Congress that 
the state of the Union was good. I am 



happy to be able to report to you today that 
the state of the Union continues to be good. 
Our Republic continues to increase in the 
enjoyment of freedom within its borders, 



Harry S. Truman, ig^o 



Jan. 4 [2] 



and to offer strength and encouragement to 
all those who love freedom throughout the 
world. 

During the past year we have made nota- 
ble progress in strengthening the foundations 
of peace and freedom, abroad and at home. 

We have taken important steps in secur- 
ing the North Atlantic community against 
aggression. We have continued our suc- 
cessful support of European recovery. We 
have returned to our established policy of 
expanding international trade through re- 
ciprocal agreement. We have strengthened 
our support of the United Nations. 

While great problems still confront us, 
the greatest danger has receded — ^the pos- 
sibility which faced us 3 years ago that most 
of Europe and the Mediterranean area might 
collapse under totalitarian pressure. Today, 
the free peoples of the world have new 
vigor and new hope for the cause of peace. 

In our domestic affairs, we have made 
notable advances toward broader oppor- 
tunity and a better life for all our citizens. 

We have met and reversed the first sig- 
nificant downturn in economic activity since 
the war. In accomplishing this, Govern- 
ment programs for maintaining employment 
and purchasing power have been of tremen- 
dous benefit. As the result of these pro- 
grams, and the wisdom and good judgment 
of our businessmen and workers, major re- 
adjustments have been made without wide- 
spread suffering. 

During the past year, we have also made 
a good start in providing housing for low- 
income groups; we have raised minimum 
wages; we have gone forward with the de- 
velopment of our natural resources; we have 
given a greater assurance of stability to the 
farmer; and we have improved the organi- 
zation and eflSciency of our Government. 

Today, by the grace of God, we stand a 
free and prosperous nation with greater pos- 
sibilities for the future than any people ever 



had before in the history of the world. 

We are now, in this year of 1950, nearing 
the midpoint of the 20th century. 

The first half of this century will be 
known as the most turbulent and eventful 
period in recorded history. The swift pace 
of events promises to make the next 50 years 
decisive in the history of man on this planet. 

The scientific and industrial revolution 
which began two centuries ago has, in the 
last 50 years, caught up the peoples of the 
globe in a common destiny. Two world- 
shattering wars have proved that no corner 
of the earth can be isolated from the affairs 
of mankind. 

The human race has reached a turning 
point. Man has opened the secrets of nature 
and mastered new powers. If he uses them 
wisely, he can reach new heights of civiliza- 
tion. If he uses them foolishly, they may 
destroy him. 

Man must create the moral and legal 
framework for the world which will insure 
that his new powers are used for good and 
not for evil. In shaping the outcome, the 
people of the United States will play a 
leading role. 

Among all the great changes that have 
occurred in the last 50 years, none is more 
important than the change in the position 
of the United States in world affairs. Fifty 
years ago we were a country devoted largely 
to our own internal affairs. Our industry 
was growing, and we had new interests in 
the Far East and in the Caribbean, but we 
were primarily concerned with the develop- 
ment of vast areas of our own continental 
territory. 

Today, our population has doubled. Our 
national production has risen from about $50 
billion, in terms of today's prices, to the 
staggering figure of $255 billion a year. We 
have a more productive economic system and 
a greater industrial potential than any other 
nation on the globe. Our standard of living 



[2] Jan. 4 



Public Papers of the Presidents 



is an inspiration for all other peoples. Even 
the slightest changes in our economic and 
social life have their effect on other countries 
all around the world. 

Our tremendous strength has brought with 
it tremendous responsibilities. We have 
moved from the outer edge to the center of 
world affairs. Other nations look to us for 
a wise exercise of our economic and mili- 
tary strength, and for vigorous support of the 
ideals of representative government and a 
free society. We will not fail them. 

Our objective in the world is peace. Our 
country has joined with others in the task of 
achieving peace. We know now that this is 
not an easy task, or a short one. But we are 
determined to see it through. Both of our 
great political parties are committed to work- 
ing together — ^and I am sure they will con- 
tinue to work together — to achieve this end. 
We are prepared to devote our energy and 
our resources to this task, because we know 
that our own security and the future of man- 
kind are at stake. 

Right here, I want to say that no one 
appreciates more than I the bipartisan co- 
operation in foreign affairs which has been 
enjoyed by this administration. 

Our success in working with other na- 
tions to achieve peace depends largely on 
what we do at home. We must preserve 
our national strength. Strength is not sim- 
ply a matter of arms and force. It is a matter 
of economic growth, and social health, and 
vigorous institutions, public and private. We 
can achieve peace only if we maintain our 
productive energy, our democratic institu- 
tions, and our firm belief in individual free- 
dom. 

Our surest guide in the days that lie ahead 
will be the spirit in which this great Re- 
public was founded. We must make our 
decisions in the conviction that all men 
are created equal, that they are equally en- 
tided to life, liberty, and the pursuit of 



happiness, and that the duty of government 
is to serve these ends. 

This country of ours has experienced many 
blessings, but none greater than its dedica- 
tion to these principles. At every point in 
our history, these ideals have served to cor- 
rect our failures and shortcomings, to spur 
us on to greater efforts, and to keep clearly 
before us the primary purpose of our exist- 
ence as a nation. They have enshrined for us, 
a principle of government, the moral impera- 
tive to do justice, and the divine command to 
men to love one another. 

These principles give meaning to all that 
we do. 

In foreign policy, they mean that we can 
never be tolerant of oppression or tyranny. 
They mean that we must throw our weight 
on the side of greater freedom and a better 
life for all peoples. These principles con- 
firm us in carrying out the specific programs 
for peace which we have already begun. 

We shall continue to give our whole- 
hearted support to the United Nations. We 
believe that this organization can ultimately 
provide the framework of international law 
and morality without which mankind can- 
not survive. It has already set up new stand- 
ards for the conduct of nations in the Decla- 
ration of Human Rights and the Conven- 
tion on Genocide. It is moving ahead to 
give meaning to the concept of world 
brotherhood through a wide variety of cul- 
tural, economic, and technical activities. 

The events of the past year again showed 
the value of the United Nations in bringing 
about the peaceful adjustment of tense inter- 
national controversies. In Indonesia and in 
Palestine the efforts of the United Nations 
have put a stop to bloodshed and paved the 
way to peaceful settlements. 

We are working toward the time when 
the United Nations will control weapons of 
mass destruction and will have the forces to 
preserve international law and order. While 



Harry S. Truman, ig^o 



Jan. 4 [2] 



the world remains unsettled, however, and 
as long as our own security and the security 
of the free world require, we will maintain 
a strong and well-balanced defense organi- 
zation. The Selective Service System is an 
essential part of our defense plans, and it 
must be continued. 

Under the principles of the United Nations 
Charter we must continue to share in the 
common defense of free nations against ag- 
gression. At the last session this Congress 
laid the basis for this joint effort. We now 
must put into effect the common defense 
plans that are being worked out. 

We shall continue our efforts for world 
economic recovery, because world prosper- 
ity is the only sure foundation of a perma- 
nent peace. 

As an immediate means to this end we 
must continue our support of the European 
recovery program. This program has 
achieved great success in the first 2 years of 
its operation, but it has not yet been com- 
pleted. If we were to stop this program 
now, or cripple it, just because it is succeed- 
ing, we should be doing exactly what the 
enemies of democracy want us to do. We 
should be just as foolish as a man who, for 
reasons of false economy, failed to put a roof 
on his house after building the foundation 
and the walls. 

World prosperity also requires that we do 
all we can to expand world trade. As a 
major step in this direction we should 
prompdy join the International Trade Or- 
ganization. The purpose of this organiza- 
tion, which the United States has been fore- 
most in creating, is to establish a code of fair 
practice, and an international authority for 
adjusting differences in international com- 
mercial relations. It is an effort to prevent 
the kind of anarchy and irresponsibility in 
world trade which did so much to bring 
about the world depression of the 1930's. 

An expanding world economy requires the 



improvement of living standards and the 
development of resources in areas where 
human poverty and misery now prevail. 
Without such improvement the recovery of 
Europe and the future of our own economy 
will not be secure. I urge that the Congress 
adopt the legislation now before it to provide 
for increasing the flow of technical assistance 
and capital investment in underdeveloped 
regions. 

It is more essential now than ever, if the 
ideals of freedom and representative gov- 
ernment are to prevail in these areas, and 
particularly in the Far East, that their peo- 
ples experience, in their own lives, the bene- 
fits of scientific and economic advances. 
This program will require the movement of 
large amounts of capital from the industrial 
nations, and particularly from the United 
States, to productive uses in the underde- 
veloped areas of the world. Recent world 
events make prompt action imperative. 

This program is in the interest of all peo- 
ples — ^and has nothing in common with 
either the old imperialism of the last century 
or the new imperialism of the Communists. 

Our aim for a peaceful, democratic world 
of free peoples will be achieved in the long 
run, not by force of arms, but by an appeal 
to the minds and hearts of men. If the 
peace policy of the democratic nations is to 
be successful, they must demonstrate that 
the benefits of their way of life can be in- 
creased and extended to all nations and all 
races. 

In the world today we are confronted with 
the danger that the rising demand of people 
everywhere for freedom and a better life 
may be corrupted and betrayed by the false 
promises of communism. In its ruthless 
struggle for power, communism seizes upon 
our imperfections, and takes advantage of 
the delays and setbacks which the democratic 
nations experience in their effort to secure 
a better life for their citizens. This chal- 



[2] Jan. 4 



Public Papers of the Presidents 



lenge to us is more than a military challenge. 
It is a challenge to the honesty of our profes- 
sion of the democratic faith; it is a challenge 
to the efficiency and stability of our economic 
system; it is a challenge to the willingness 
to work with other peoples for world peace 
and for world prosperity. 

For my part I welcome that challenge. I 
believe that our country, at this crucial point 
in world history, will meet that challenge 
successfully. I believe that, in cooperation 
with the other free nations of the world, we 
shall extend the full benefits of the demo- 
cratic way of life to millions who do not now 
enjoy them, and preserve mankind from 
dictatorship and tyranny. 

I believe that we shall succeed in our 
struggle for this peace, because I have seen 
the success we have had in our own coun- 
try in following the principles of freedom. 
Over the last 50 years, the ideals of liberty 
and equal opportunity to which this Na- 
tion is dedicated have been increasingly 
realized in the lives of our people. 

The ideal of equal opportunity no longer 
means simply the opportunity which a man 
has to advance beyond his fellows. Some of 
our citizens do achieve greater success than 
others as a reward for individual merit and 
effort, and this is as it should be. At the 
same time our country must be more than 
a land of opportunity for a select few. It 
must be a land of opportunity for all of us. 
In such a land we can grow and prosper to- 
gether. 

The simple truth that we can all go for- 
ward together is often questioned by selfish 
or shortsighted persons. It is strange that 
this is so, for this proposition is so clearly 
demonstrated by our national history. Dur- 
ing the last 50 years, for example, our Na- 
tion has grown enormously in material well- 
being. This growth has come about, not by 
concentrating the benefits of our progress in 
the hands of a few, but by increasing the 



wealth of the great body of our Nation and 
our citizens. 

In the last 50 years the income of the aver- 
age family has increased so greatly that its 
buying power has doubled. The average 
hours of work have declined from 60 to 40 
a week, the whole hourly production of the 
average worker has tripled. Average wages, 
allowing for price changes, have increased 
from about 45 cents an hour to $1.40 an hour. 

We have accomplished what to earlier ages 
of mankind would have been a miracle — ^we 
work shorter hours, we produce more, and 
we live better. 

Increasing freedom from poverty and 
drudgery has given a fuller meaning to 
American life. Our people are better edu- 
cated; we have more opportunities for travel 
and recreation and enjoyment of the arts. 
We enjoy more personal liberty in the 
United States today than ever before. 

If we can continue in the spirit of co- 
operative adventure which has marked the 
recent years of our progress, we can expect 
further scientific advances, further in- 
creases in our standard of living, and a still 
wider enjoyment of democratic freedom. 

No one, of course, can foretell the future 
exactly. However, if we assume that we 
shall grow as fast in the future as we have 
grown in the past, we can get a good idea of 
how much our country should grow in the 
next 50 years. 

At present our total national production 
is $255 billion a year. Our working popula- 
tion and our output per worker are increase 
ing. If our productive power continues to 
increase at the same rate as it has increased 
over the past 50 years, our total national 
production 50 years from now will be nearly 
four times as much as it is today. Allowing 
for the expected growth in population, this 
would mean that the real income of the aver- 
age family in the year 2000 A.D. would be 
about three times what it is today. 



Harry S. Truman, ig^o 



Jan. 4 [2] 



These are estimates of what we can do in 
the future, but we can reach these heights 
only if we follow the right policies. We 
have learned by bitter experience that prog- 
ress is not automatic — that wrong policies 
lead to depression and disaster. We cannot 
achieve these gains unless we have a stable 
economy and avoid the catastrophes of boom 
and bust that have set us back in the past. 

These gains cannot be achieved unless our 
businessmen maintain their spirit of initiative 
and enterprise and operate in a competitive 
economy. They cannot be achieved unless 
our workingmen and women and their 
unions help to increase productivity and ob- 
tain for labor a fair share of the benefits of 
our economic system. They cannot be 
achieved unless we have a stable and pros- 
perous agriculture. They cannot be achieved 
unless we conserve and develop our natural 
resources in the public interest. Our system 
will not work unless our people are healthy, 
well-educated, and confident of the future. 
It will not work unless all citizens can par- 
ticipate fully in our national life. 

In achieving these gains the Government 
has a special responsibility to help create 
and maintain the conditions which will per- 
mit the growth we know is possible. Fore- 
most among these conditions is the need 
for a fair distribution of our increasing pros- 
perity among all the great groups of our 
population who help to bring it about — 
labor, business, agriculture. 

Businessmen must continue to have the 
incentives necessary for investment and for 
the development of new lines of enterprise. 
In the future growth of this country, lie 
possibilities for hundreds of thousands of 
new and independent businesses. As our 
national production increases, as it doubles 
and redoubles in the next 50 years, the num- 
ber of independent and competing enter- 
prises should also increase. If the number 
does not increase, our constantly growing 



economy will fall under the control of a few 
dominant economic groups whose powers 
will be so great that they will be a challenge 
to democratic institutions. 

To avoid this danger, we must curb 
monopoly and provide aids to independent 
business so that it may have the credit and 
capital to compete in a system of free enter- 
prise. I recommend that the Congress com- 
plete action at this session on the pending 
bill to close the loopholes in the Clayton 
Act which now permit monopolistic merg- 
ers. I also hope before this session is over 
to transmit to the Congress a series of pro- 
posals to strengthen the antimonopoly laws, 
to assist small business, and to encourage the 
growth of new enterprises. 

In the case of labor, free collective bar- 
gaining must be protected and encouraged. 
Collective bargaining is not only a funda- 
mental economic freedom for labor. It is 
also a strengthening and stabilizing influence 
for our whole economy. 

The Federal statute now governing labor 
relations is punitive in purpose and one- 
sided in operation. This statute is, and al- 
ways has been, inconsistent with the practice 
of true and effective collective bargaining. 
It should be repealed and replaced by a law 
that is fair to all and in harmony with our 
democratic ideals. 

A full understanding of the problems of 
modern labor relations is of such importance 
that I recommend the establishment of a 
labor extension service to encourage educa- 
tional activities in this field. 

Another essential for our continued 
growth is a stable and prosperous agricul- 
ture. For many years we have been build- 
ing a program to give the farmer a reason- 
able measure of protection against the special 
hazards to which he is exposed. That pro- 
gram was improved at the last session of the 
Congress. However, our farm legislation 
is still not adequate. 



[2] Jan. 4 



Public Papers of the Presidents 



Although the Congress has properly de- 
clared as a matter of national policy that safe- 
guards must be maintained against slumps 
in farm prices, there are serious shortcomings 
in the methods now available for carrying 
out this policy. Mandatory price supports 
should be provided for the commodities not 
now covered which are major sources of 
farm income. 

Moreover, we should provide a method of 
supporting farm income at fair levels which 
will, at the same time, avoid piling up un- 
manageable surpluses and allow consumers 
to obtain the full benefit of our abundant 
agricultural production. A system of pro- 
duction payments gives the greatest promise 
of accomplishing this purpose. I recom- 
mend that the use of such a system be 
authorized. 

One of the most important factors in our 
continued grovnh is the construction of more 
good, up-to-date housing. In a country 
such as ours there is no reason why decent 
homes should not be within the reach of 
all. With the help of various Government 
programs we have made great progress in 
the last few years in increasing the number 
of homes. 

Despite this increase, there is still an acute 
shortage of housing for the lower and 
middle-income groups, especially in large 
metropolitan areas. We have laid the 
groundwork for relieving the plight of lower- 
income families in the Housing Act of 1949. 
To aid the middle-income families, I recom- 
mend that the Congress enact new legislation 
authorizing a vigorous program to help co- 
operatives and other nonprofit groups build 
housing which these families can afford. 

Rent control has done a great deal to 
prevent the housing shortage from having 
had worse effects during this postwar period 
of adjustment. Rent control is still neces- 
sary to prevent widespread hardship and 
sharp curtailment of the buying power of 



millions of consumers in metropolitan areas. 
I recommend, therefore, that rent control be 
continued for another year. 

If we are to achieve a better life for all, 
the natural resources of the country must be 
regarded as a public trust. We must use 
our precious assets of soil, water, and forest, 
and grassland in such a way that they be- 
come constandy more productive and more 
valuable. Government investment in the 
conservation and development of our re- 
sources is necessary to the future economic 
expansion of the country. 

We need to enlarge the production and 
transmission of public power. That is true 
not only in those regions which have already 
received great benefits from Federal power 
projects, but also in regions such as New 
England where the benefits of large-scale 
public power development have not yet been 
experienced. 

In our hydroelectric and irrigation under- 
takings, as well as in our other resource pro- 
grams, we must continue policies to assure 
that their benefits will be spread among the 
many and not restricted to the favored few. 

Important resource legislation which 
should be passed at this session includes the 
authorization of the St. Lawrence seaway 
and power project and the establishment of 
the Columbia Valley Administration — ^the 
establishment of the Columbia Valley Ad- 
ministration, I don't want you to miss that. 

Through wise Government policies and 
Government expenditures for the conserva- 
tion and development of our natural re- 
sources, we can be sure of transmitting to 
our children and our children's children a 
country far richer and more productive than 
the one we know today. 

The value of our natural resources is con- 
standy being increased by the progress of 
science. Research is finding new ways of 
using such natural assets as minerals, sea 
water, and plant life. In the peaceful de- 



8 



Harry S. Truman, ig^o 



Jan. 4 [2] 



velopment of atomic energy, particularly, we 
stand on the threshold of new wonders. 
The first experimental machines for pro- 
ducing useful power from atomic energy are 
now under construction. We have made 
only the first beginnings in this field, but in 
the perspective of history they may loom 
larger than the first airplane, or even the first 
tools that started man on the road to civili- 
zation. 

To take full advantage of the increasing 
possibilities of nature we must equip our- 
selves with increasing knowledge. Govern- 
ment has a responsibility to see that our 
country maintains its position in the advance 
of science. As a step toward this end, the 
Congress should complete action on the 
measure to create a National Science Foim- 
dation. 

Another duty of the Government is to pro- 
mote the economic security, the health, and 
the education of its citizens. By so doing, 
we strengthen both our economy and the 
structure of our society. In a nation as rich 
as ours, all citizens should be able to live in 
decency and health. 

Our Social Security System should be de- 
veloped into the main reliance of our people 
for basic protection against the economic 
hazards of old-age, unemployment, and ill- 
ness. I earnestly hope that the Congress 
will complete action at this session on legis- 
lation to increase the benefits and extend the 
coverage of old-age and survivors' insurance. 
The widespread movement to provide pen- 
sions in private industry dramatizes the need 
for improvements in the public insurance 
system. 

I also urge that the Congress strengthen 
our unemployment compensation law to 
meet present-day needs more adequately. 
The economic downturn of the past year 
was the first real test that our system of un- 
employment insurance has had to meet. 
That test has proved the wisdom of the sys- 



tem, but it has also made strikingly appar- 
ent the need for improving its operation and 
increasing its coverage and its benefits. 

In the field of health there are immense 
opportunities to extend to more of our people 
the benefits of the amazing advances in med- 
ical science. We have made a good begin- 
ning in expanding our hospitals, but we must 
also go on to remedy the shortages of doc- 
tors, nurses, and public health services, and 
to establish a system of medical insurance 
which will enable all Americans to afford 
good medical care. 

We must take immediate steps to 
strengthen our educational system. In many 
parts of our country, young people are being 
handicapped for life because of a poor educa- 
tion. The rapidly increasing number of 
children of school age, coupled with the 
shortage of qualified teachers, makes this 
problem more critical each year. I believe 
that the Congress should no longer delay in 
providing Federal assistance to the States so 
that they can maintain adequate schools. 

As we go forward in achieving greater 
economic security and greater opportunity 
for all our people, we should make every ef- 
fort to extend the benefits of our democratic 
institutions to every citizen. The religious 
ideals which we profess, and the heritage of 
freedom which we have received from the 
past, clearly place that duty upon us. I again 
urge the Congress to enact the civil rights 
proposals I made in February 1948. These 
proposals are for the enactment of Federal 
statutes which will protect all our people in 
the exercise of their democratic rights and 
their search for economic opportunity, grant 
statehood to Alaska and Hawaii, provide 
a greater measure of self-government for our 
island possessions, and accord home rule to 
the District of Columbia. Some of those 
proposals have been before the Congress for 
a long time. Those who oppose them, as 
well as those who favor them, should recog- 



[2] Jan. 4 



Public Papers of the Presidents 



nize that it is the duty of the elected repre- 
sentatives of the people to let these proposals 
come to a vote. 

Our democratic ideals, as vi^ell as our best 
interests, require that v^e do our fair share 
in providing homes for the unfortunate vic- 
tims of v^ar and tyranny. In so doing, we 
shall add strength to our democracy through 
the abilities and skills v^hich these men and 
women will bring here. I urge the prompt 
enactment by the Congress of the legisla- 
tion now before it to extend and broaden the 
existing displaced persons law and remove its 
discriminatory features. 

The measures I am recommending to 
the Congress concerning both our foreign 
and our domestic policies represent a care- 
fully considered program to meet our na- 
tional needs. It is a program which neces- 
sarily requires large expenditures of funds. 
More than 70 percent of the Government's 
expenditures are required to meet the costs 
of past wars and to work for world peace. 
This is the dominant factor in our fiscal 
policy. At the same time, the Government 
must make substantial expenditures which 
are necessary to the growth and expansion 
of the domestic economy. 

At present, largely because of the ill-con- 
sidered tax reduction of the 8oth Congress, 
the Government is not receiving enough 
revenue to meet its necessary expenditures. 

To meet this situation, I am proposing 
that Federal expenditures be held to the low- 
est levels consistent with our international 
requirements and the essential needs of 
economic growth, and the well-being of our 
people. I think I had better read that over; 
you interrupted me in the middle. 

To meet this situation, I am proposing that 
Federal expenditures be held to the lowest 
levels consistent with our international re- 
quirements and the essential needs of eco- 
nomic growth, and the well-being of our 
people. Don't forget that last phrase. At 



the same time, we must guard against the 
folly of attempting budget slashes which 
would impair our prospects for peace or crip- 
ple the programs essential to our national 
strength. 

The budget recommendations I shall short- 
ly transmit to the Congress show that we can 
expect a substantial improvement in our fis- 
cal position over the next few years, as the 
cost of some of our extraordinary postwar 
programs declines, and as the Government 
revenue rises as a result of growth in em- 
ployment and national income. To fur- 
ther improve our fiscal outlook, we should 
make some changes in our tax system which 
will reduce present inequities, stimulate 
business activity, and yield a moderate 
amount of additional revenue. I expect to 
transmit specific recommendations to the 
Congress on this subject at a very early date. 

The fiscal policy I am recommending is 
the quickest and safest way of achieving a 
balanced budget. 

As we move forward into the second half 
of the 20th century, we must always bear in 
mind the central purpose of our national life. 
We do not seek material prosperity for our- 
selves because we love luxury; we do not aid 
other nations because we wish to increase 
our power. We have not devised programs 
for the security and well-being of our people 
because we are afraid or unwilling to take 
risks. This is not the meaning of our past 
history or our present course. 

We work for a better life for all, so that all 
men may put to good use the great gifts 
with which they have been endowed by their 
Creator. We seek to establish those material 
conditions of life in which, without excep- 
tion, men may live in dignity, perform use- 
ful work, serve their communities, and wor- 
ship God as they see fit. 

These may seem simple goals, but they 
are not little ones. They are worth a great 
deal more than all the empires and conquests 



10 



Harry S. Truman, igp 



Jan. 5 [3] 



of history. They are not to be achieved by 
military aggression or political fanaticism. 
They are to be achieved by humbler means — 
by hard work, by a spirit of self-restraint in 
our dealings v^ith one another, and by a deep 
devotion to the principles of justice and 
equality. 

It should make us truly thankful, as we 
look back to the beginnings of this country, 
that we have come so far along the road to 
a better life for all. It should make us hum- 
ble to think, as we look ahead, how much 



farther we have to go to accomplish, at home 
and abroad, the objectives that were set out 
for us at the founding of this great Nation. 
As we approach the halfway mark of the 
20th century, we should ask for continued 
strength and guidance from that Almighty 
Power who has placed before us such great 
opportunities for the good of mankind in 
the years to come. 

note: The President spoke at i p.m. The address 
was broadcast over radio and television. 



3 The President's News Conference of 
January 5, 1950 



THE PRESIDENT, [i.] I have a statement I 
want to read to you. It will be handed to 
you in mimeographed form after the press 
conference. 

[Reading] "The United States Govern- 
ment has always stood for good faith in in- 
ternational relations. Traditional United 
States policy toward China, as exemplified 
in the open-door policy, called for interna- 
tional respect for the territorial integrity of 
China. This principle was recendy reaf- 
firmed in the United Nations General As- 
sembly Resolution of December 8, 1949, 
which, in part, calls on all states, and I quote: 

" To refrain from (a) seeking to acquire 
spheres of influence or to create foreign con- 
trolled regimes within the territory of China; 
(b) seeking to obtain special rights or priv- 
ileges within the territory of China.'" 

That is the end of the quotation from the 
United Nations Resolution. 

[Continuing reading] "A specific applica- 
tion of the foregoing principles is seen in 
the present situation with respect to For- 
mosa. In the Joint Declaration at Cairo 
on December i, 1943, the President of the 
United States, the British Prime Minister, 
and the President of China stated that it was 



their purpose that territories Japan had 
stolen from China, such as Formosa, should 
be restored to the Republic of China. The 
United States was a signatory to the Potsdam 
Declaration of July 26, 1945, which declared 
that the terms of the Cairo Declaration 
should be carried out. The provisions of 
this declaration were accepted by Japan at 
the time of its surrender. In keeping with 
these declarations, Formosa was surrendered 
to Generalissimo Chiang Kai-shek, and for 
the past 4 years the United States and other 
Allied Powers have accepted the exercise of 
Chinese authority over the island. 

"The United States has no predatory de- 
signs on Formosa, or on any other Chinese 
territory. The United States has no desire 
to obtain special rights or privileges, or to 
establish military bases on Formosa at this 
time. Nor does it have any intention of 
utilizing its Armed Forces to interfere in 
the present situation. The United States 
Government will not pursue a course which 
will lead to involvement in the civil conflict 
in China. 

"Similarly, the United States Govern- 
ment will not provide military aid or advice 
to Chinese forces on Formosa. In the view 



II 



[S] Jan. 5 



Public Papers of the Presidents 



of the United States Government, the re- 
sources on Formosa are adequate to enable 
them to obtain the items which they might 
consider necessary for the defense of the 
island. The United States Government pro- 
poses to continue under existing legislative 
authority the present EGA program of eco- 
nomic assistance." 

At 2:30 this afternoon Dean Acheson v^ill 
hold a press conference and further elab- 
orate on the details with reference to this 
statement which I have just issued on the 
policy of the United States Government 
toward China and Formosa.^ 

I do not want to answer any questions on 
the subject now, so save your questions for 
this afternoon. 

Are there any other questions? ILaughter^ 

[2.] Q. Mr. President, I have a couple of 
atomic energy questions. 

THE PRESIDENT. ShoOt. 

Q. Since you were the source of informa- 
tion on the first Russian atomic bomb ex- 
plosion, can you comment on a London re- 
port that said Russia is going to explode 
another bomb next Saturday? 

THE PRESIDENT. I had no advance infor- 
mation on the explosion of the other Russian 
bomb. Naturally, I have no advance in- 
formation on this one.^ 

[3.] Q. Mr. President, were you person- 
ally sufEciendy acquainted with Sir Willmott 
Lewis ^ that you would care to comment on 
his passing? 

THE PRESIDENT. I was just casually ac- 
quainted with him, but I knew him by repu- 
tation, and of course I was sincerely sorry 
to hear of his passing. I didn't know about 



* For the remarks of the Secretary o£ State at his 
press conference on January 5, see the Department of 
State Bulletin (vol. 22, p. 79). 

^For the statement by the President announcing 
the first atomic explosion in the Soviet Union, see 
1949 volume, this series, Item 216. 

^ Sir Willmott H. Lewis, Washington correspond- 
ent emeritus of the London Times. 



it until I saw it in the paper, I think this 
morning. 

[4.] Q. Mr. President, the St. Louis 
Citizens Fuel Committee and the St. Louis 
Retail Coal Association both wired you, ei- 
ther last night or today, saying that while 
temperatures were dropping out there their 
fuel supply was running low, and urged 
that for public health and safety you secure 
full operation of the coal mines without 
delay. Have you seen those telegrams? 

THE PRESIDENT. No, I havcn't seen them. 

Q. Any comment? 

THE PRESIDENT. I think possibly they were 
sent to the press and not to me, so I can't an- 
swer them to the press. However, when I 
get them, I will see if they are entided to an 
answer, and if they are they will get an 
answer. 

[5.] Q. Mr. President, when you re- 
ferred to public power development in New 
England in your message,^ were you refer- 
ring to the Passamaquoddy tidal power or 
were you referring to river power? 

THE PRESIDENT. Both. 

Q. On that same line, how would you 
favor similar TVA development on the 
Cumberland River in Tennessee? 

THE PRESIDENT. I am uot familiar with 
that situation, and I can't answer that ques- 
tion. 

[6.] Q. Mr. President, I am in a high 
state of confusion concerning the — on that 
perennial St. Lawrence power and naviga- 
tion project. 

THE PRESIDENT. What causes the confu- 
sion? 

Q. There have been a lot of maneuvers. 

THE PRESIDENT. What do you mean? 

Q. I don't know whether I can clear them 
up in this rapid fire question and answer, 
but I would like to explain a little bit about 
it to you, if you will permit me? 



* See Item 2. 



12 



Harry S. Truman, ig^o 



Jan. 5 [3] 



THE PRESIDENT. Surc, go right ahead. 

Q. You know some months ago the On- 
tario and New York power people got to- 
gether on a proposal to develop power sepa- 
rately from the navigation, and you took the 
stand that it was all or nothing. 

THE PRESIDENT. That is correct, and I still 
am of that same frame of mind; all or 
nothing. 

Q. And that seemed effectively to put it 
on ice for a while, but while you were away, 
I think, they reactivated it over in the Federal 
Power Commission. 

THE PRESIDENT. Well, I will never agree to 
the development of the St. Lawrence power 
project until the St. Lawrence Seaway proj- 
ect is attached to it. They go together. It 
should be developed together. That is for 
the interests of the whole United States, 
when it is developed that way. The other 
development is just for the interests of power 
in Ontario and the State of New York. And 
I want the whole country to have some good 
out of that development if we are going to 
pay for it. 

[7.] Q. Mr. President, for those of us 
who have been waiting for a full National 
Labor Relations Board, have you any news 
today? 

THE PRESIDENT. No, I havcn't. 

Q. Have you any nominations at all that 
you might tell us? 

THE PRESIDENT. A whole batch of recess 
appointments today at noon.° 

Q. Recess appointments? 

THE PRESIDENT. Appointments that were 
made during recess. I am sending them 
up. We will give you a list of them. 

Q. Any interesting ones that might make 
better news ? [Laughter] 

THE PRESIDENT. No. You havc them all. 



"For the list of the President's nominations re- 
ceived by the Senate on January 5, sec the Con- 
gressional Record (vol. 96, p. 106). 



[8.] Q. Mr. President, there are reports 
from out in Missouri as to whether you 
have endorsed the candidacy of State Sen- 
ator Emery Allison for United States Sena- 
tor? 

THE PRESIDENT. I kuow Emery Allison 
very well. I like him, and I think he would 
make a wonderful United States Senator 
from Missouri. When the primary comes 
around, I shall vote for him. 

Q. Where is he from, Mr. President? 

THE PRESIDENT. Where is he from? RoUa, 
Mo. He is the ranking Democratic member 
of the State Senate of Missouri. 

Q. How do you spell his name, sir? 

THE PRESIDENT. A-l-l-i-s-o-u — but I am not 
sure whether it has two I's or not. E-m-e-r-y 
A-1-l-i-s-o-n. Whether it has two I's or not, 
I can't remember. 

[9.] Q. There is another power ques- 
tion I would like to ask you about? 

THE PRESIDENT. Shoot — ^go right ahead. 

Q. Do you favor development of Niagara 
power as well as the St. Lawrence? 

THE PRESIDENT. Oh, yes. I am for the de- 
velopment of all the power we can get in 
that corner of the United States. There are 
four great power projects in this country in 
which I am vitally interested. The North- 
east power project, which includes New 
England developments, about which I was 
talking awhile ago, and the St. Lawrence. 
And the Northwest, which includes the 
Columbia and Snake River developments, 
and the Central Valley of California. And 
the Southwest, which includes Boulder Dam, 
and those projects in Texas and Oklahoma. 
And the southeast — ^northeast — northwest 
Arkansas, southwest Missouri, and northeast 
Oklahoma. And then the southeast devel- 
opment of the Tennessee Valley, and the 
Savannah, and the rivers in South Carolina 
on which we are building power projects. 

We will then have a network of power in 



13 



[3] Jan. 5 



Public Papers of the Presidents 



the United States, and if we can get the 
three developments for the upper Missis- 
sippi, Missouri, and Ohio Valleys, we will 
have an inexhaustible supply of power, of 
which I think there can never be too much. 

Q. In connection with that, are you figur- 
ing on the St. Lawrence Valley? 

THE PRESIDENT. St. Lawreuce Seaway, I 
want the St. Lawrence Seaway development 
all the way to Chicago, so that we can — and 
Duluth — so that we can tie up in Chicago. 
We have nothing at the docks in Chicago 
and Duluth. 

Q. I wonder whether you are in favor of 
a long-term TVA for that area? 

THE PRESIDENT, No, that will have to be 
a proposal carried out between the Govern- 
ments of Canada and the United States, and 
the division of power in the United States 
will have to be under the control of the 
Federal Government. 

Q. Well, Mr. President, will you send a 
message on New England development? 

THE PRESIDENT. I probably will. As soon 
as possible, I probably will send a letter to 
the Congress on the subject.^ 

[lo.] Q. Mr. President, is it true that 
you plan to decide by February 15th on con- 
struction of a hydrogen-powered atomic 
bomb project? ^ 

THE PRESIDENT. I have no comment to 
make on that. 

[11.] Q. Mr. President, in your message 
yesterday, I believe you did not mention the 
Missouri Valley Authority? 

THE PRESIDENT. Well, I am interested in 
the development of the Missouri, Mississippi, 
and Ohio Rivers as a project. I think they 
will — all three of them, the Mississippi, the 
Missouri, and the Ohio Rivers — will soon 
be developed as a central valley project for 
the United States. 



® See Item 33. 
■^ See Item 26. 



[12.] Q. Mr. President, do you favor 
Federal development of the Niagara River? 

THE PRESIDENT. What's that? 

Q. Federal development of the Niagara 
River? 

THE PRESIDENT. I waut to make it a seaway 
of the St. Lawrence River. If the Niagara 
is included in that, why of course that will 
be all right. I don't think it is, though. 
I think there is a canal that goes around that 
still. 

Q. The United States and Canada are now 
conferring on power development in the 
Niagara River. 

THE PRESIDENT. The St. Lawreuce devel- 
opment, I think, was our project, and I am 
for the development of the St. Lawrence 
Seaway power project. You can make it as 
broad as you want to. 

[13.] Q. In view of your comment on 
the Missouri election, do you have anybody 
in Ohio that you like the looks of? 

THE PRESIDENT. I don't dabble in primary 
politics in any State except Missouri. 

Q. Mr. President, in Pennsylvania Senator 
Myers is unopposed for the — ^the Democratic 
nomination for Senator. The Republicans, 
I believe, have a couple of boys that haven't 
been definitely announced. I was wonder- 
ing if you are going into Pennsylvania to 
speak for Senator Myers? 

THE PRESIDENT. It wou't be ucccssary for 
me to go into Pennsylvania in the primary. 
I don't care how much trouble the Repub- 
licans have in the primary. I hope the 
Democrats won't have any. [Laughter] 

Q. I mean subsequently? 

THE PRESIDENT. Well, I wiU auswer that 
question when the time comes. 

[14.] Q. Mr. President, I would like to 
get this Missouri Valley thing straightened 
out. 

THE PRESIDENT. ShoOt. 

Q. Is it your idea that the Pick-Sloan 



14 



Harry S. Truman, ig$o 



Jan. 5 [3] 



plan ^ will eventually envelop the Missouri 
Valley Authority? 

THE PRESIDENT. Yes. Ycs. I am very 
sure it vi^ill. 

Q. That is your idea, that eventually Pick- 
Sloan v^ill 

THE PRESIDENT. Will develop all the Mis- 
souri Valley Authority. Then I v^ant to 
develop the Mississippi and Ohio in con- 
junction w^ith the suggestion covering the 
whole valley. 

Q. Now then, on the Missouri, will you 
have an authority — an administration for the 
Pick-Sloan plan, or will you still have 

THE PRESIDENT. We wiU cross that bridge 
when we get to it. I am not ready to go into 
detail on it at all. There has been too much 
detail on it now. That is the reason we are 
having trouble with it. You have got nine 
Governors of nine States on that river. 

[15.] Q. Mr. President, one more ques- 
tion in answer to Mrs. Craig's? ^ 

THE PRESIDENT. Sure. 

Q. You said that you were covering the 
plan with a letter. Does that apply solely 
to Northeast power, or the whole project? 

THE PRESIDENT. That applies to New Eng- 
land. We have already made a statement 
on the St. Lawrence Seaway and power 
project. I am anxious to see that there is 
proper development of power in the New 
England area. 

[16.] Q. When do you plan to submit 
your special message on taxes? 



® Joint plan for the division of responsibility in the 
Missouri Valley between the Corps of Engineers and 
the Bureau of Reclamation. The Engineer Corps 
was given responsibility for determining the capac- 
ities of main-stem and tributary reservoirs for flood 
control and navigation. The Bureau assumed re- 
sponsibility for determining the capacities of reser- 
voirs for irrigation purposes. The plan was 
approved by Congress on December 22, 1944 (sec. 
9, 58 Stat. 891). However, the Congress did not 
approve President Roosevelt's request for the crea- 
tion of a Missouri Valley Authority. 

*Mrs. May Craig of the Portland (Maine) Press 
Herald. 



THE PRESIDENT. Just as soon as it is ready .^° 

Q. Mr. President, what are your plans on 
strengthening the antitrust laws? 

THE PRESIDENT. They are in the message. 
I made them as plain as I could in the mes- 
sage.^^ 

Q. You spoke of future recommendations. 

THE PRESIDENT. That is correct. Just as 
quickly as I can get the recommendations 
ready, I will send them down. 

Q. The same for small business ? 

THE PRESIDENT. Yes. They cover both. 
Can't have one without the other. 

[17.] Q. Mr. President, how do you like 
the reaction to your message yesterday? 

THE PRESIDENT. It was fine. I told you 
that yesterday as I came out. [Laughter] 

Q. Mr. President, how did you like the 
Republican response to your reference to 
the 

THE PRESIDENT. I was highly pleased when 
they turned that into an ovation for me. 
[Laughter] 

Q. Mr. President, do you expect a similar 
ovation when you explain how much a 
moderate tax increase is? 

THE PRESIDENT. Yes. Ycs, I do. Especially 
from the Democrats. 

[18.] Q. Are you encouraged to go back 
to Key West again this winter? 

THE PRESIDENT. Well, I dou't kuOW 

whether I can go or not. I would if I could. 
Mighty nice place to be when you want 
plenty of sunlight. They tell me it is going 
down to zero here pretty soon. I suppose 
we will all want to go where it is warm. 

What did you ask me? 

[19.] Q. There was a rise in stock mar- 
ket prices, I noticed, after you spoke. Do 
you regard that as one of the good reac- 
tions 

THE PRESIDENT. Well, I don't — I cau't com- 
ment on that because I didn't pay any atten- 

'<* See Item 18. 
" See Item 2. 



15 



[3] Jan. 5 



Public Papers of the Presidents 



tion to that. I wasn't making a speech to 
affect the stock market. [Laughterl It 
was in the public interest. 

[20.] Q. Was Speaker Rayburn's remark 
about the size of the budget intentional, or 
a slip, or ^^ 

THE PRESIDENT. Well now, I Can't answer 
for Speaker Rayburn. Why don't you ask 
him that question? The budget will go 
down — the Budget Message will go down 
Monday morning — ^Monday at noon — ^when- 
ever the Congress meets, and we will have 
the seminar on the Budget on Saturday 
morning,^^ and you will know just as much 
about it as I do. I am not going to discuss 
it now. 

[21.] Q. Mr. President, your reference to 
the power development in the big river 
basins was largely in terms of electric power. 
You have in mind, I presimie, more general 
multipurpose development? 

THE PRESIDENT. The principal develop- 
ment in the central valley of the Missouri, 
Mississippi, and Ohio is navigation and flood 
control. Up as far as Sioux City, Iowa, on 
the Missouri, there is no possible power for 
that particular project except maybe on some 
of the branches. The Missouri River carries 
more sediment than any other river in the 
world except the Danube, and if you would 
attempt to build a dam from bluff to bluff 
on the Missouri River, right below Sioux 
City, Iowa, it wouldn't be but about a year 
and a half and you would have lots of mud 
behind the dam, and you would have a fall 
there. 

The development of the Missouri, Ohio, 
and the Mississippi are projects that will have 
to be worked out as the features of the 



"As reported in the press, the Speaker saw the 
new budget during a White House conference on 
January 3, after which he stated that the budget 
would call for an expenditure of "a little above 
$42 billion." 

^^ See Item 8. 



ground reveal its condition. 

Q. Speaking of the Ohio Valley, how far 
up the river would you go in the develop- 
ment of it? 

THE PRESIDENT. Do you know where the 
Ohio originates? At Pittsburgh, where the 
Alleghenies come together, where there are 
now some flood control and power dams on 
the Monongahela River. And the way to 
control floods is to control the little rivers, 
and that will have to be done all over that 
valley in order to control the floods. 

Q. That is mainly a flood control proposi- 
tion for the Ohio Valley? 

THE PRESIDENT. That is the most impor- 
tant part of the development. 

[22.] Q. You have made recommenda- 
tions several times on the Central Valley of 
California? 

THE PRESIDENT. The Valley of California — 
Central Valley of California, yes. I am in 
the same frame of mind as I am for the rest 
of these developments. I want to see a 
Central Valley Authority from Shasta Dam 
all the way up to the San Bernadino 
Mountains. 

[23.] Q. Where there are expensive de- 
tails of construction, whom do you want to 
transmit the power? 

THE PRESIDENT. Where it is necessary, the 
United States Government. Where private 
industry can do it as cheaply as the United 
States Government, I am happy to have them 
doit. 

[24.] Q. Mr. President, do you plan to 
find out the type of authority for that Savan- 
nah Valley in the southeast? 

THE PRESIDENT. I hadn't given that any 
thought. 

Q. Merely want the dam built? 

THE PRESIDENT. I waut power developed, 
principally. 

[25.] Q. Mr. President, do you antici- 
pate any real coordination on these three 



16 



Harry S. Truman, ig^o 



Jan. 5 [4] 



river valleys in your present term of office? 

THE PRESIDENT. Which three do you 
mean? 

Q. The Mississippi, Missouri, and Ohio? 

THE PRESIDENT. That is a tremendous proj- 
ect — will cost about a billion and a half 
dollars. If it should be, it will have to come 



more or less gradually. We have already 
spent a billion, 250 million. It is about time 

we did some developments 

Reporter: Thank you, Mr. President. 

note: President Truman's two hundred and tenth 
news conference was held in his office at the White 
House at 10:40 a.m. on Thursday, January 5, 1950. 



4 Remarks at the American Federation of Labor's Samuel Gompers 
Centennial Dinner. January 5, 1950 



Mr. Chairman, Mr, Vice President, mem- 
bers of this great organization: 

I have been over at the house all evening, 
working on two more messages on the state 
of the Union. One of them is ready to go 
down tomorrow. It is the Economic Mes- 
sage. And then I have one that is creating 
a great deal of conversation, known as the 
Budget Message. Everybody seems to know 
all about it but me, and I am the only one 
that knows all the figures in it. 

But I was sitting over there thinking 
about this celebration in honor of one of 
labor's greatest statesmen, and I couldn't 
stay away. 

I knew that anything I would say would 
be a surplus remark after the Vice President, 
and Matthew WoU, and William Green had 
paid tribute to the great Samuel Gompers; 
but I want you to understand that I remem- 
ber him distincdy as the originator of the 
great movement which set labor free. And 
I wanted to come over here and pay tribute 
to him. 

I remember when he passed away. He 
passed away in 1924, the year in which I was 
defeated for reelection — and they never suc- 
ceeded in doing that to me since. 



I was one of Samuel Gompers' great ad- 
mirers when I was a very young man on the 
farm. Everybody in that day and age con- 
sidered him a labor statesman. He was not 
only a labor statesman in a bipartisan sense, 
but he was just as good a Democrat as I 
ever was. 

I remember very distinctly his support of 
Woodrow Wilson when Woodrow Wilson 
needed that support worse than anything he 
ever needed in his life. That was when 
California decided the election for Woodrow 
Wilson in 19 1 6. 

Samuel Gompers made a great contribu- 
tion to the welfare of this great Nation of 
ours, and I consider it a very high honor that 
Mr. Green and the people who are holding 
this meeting tonight should ask me to come 
over and pay this very slight tribute to one 
of your greatest leaders who ever lived. 

And I thank you for that privilege. 

note: The President spoke at 10:42 p.m. at the 
Statler Hotel in Washington. In his opening words 
he referred to George Meany, secretary-treasurer of 
the American Federation of Labor and chairman of 
the dinner, and Alben W. Barkley, Vice President 
of the United States. Later in his remarks the 
President referred to William Green and Matthew 
Woll, president and vice president of the American 
Federation of Labor. 



17 



[5] Jan. 6 



Public Papers of the Presidents 



5 Statement by the President on the Midcentury White House 
Conference on Children and Youth. January 6, 1950 



IN THE State of the Union Message to 
Congress, I called attention to the supreme 
need of our time to use our great powers of 
mastery over the physical world to develop 
the moral and legal framework within which 
mankind can live together in peace and 
harmony. The peoples of the earth look to 
us as never before for good will, strength, 
and wise leadership. If we are not to fail 
them and ourselves, our children must be 
prepared. 

It is in the hope that in the next half cen- 
tury we may write a new chapter of history, 
different from the first half, with its wars 
and injustices on an unparalleled scale, that 
I have proposed the Midcentury White 
House Conference on Children and Youth 
to be held in December 1950. 

I was delighted to learn from the repre- 
sentatives of the national committee for this 
Conference, who called on me today, that 
already great numbers of citizens see the 
significance of this effort, and are working 
together to make this Midcentury Conference 



a powerful force for improving the environ- 
ment in which our children grow up, for 
increasing our understanding of children's 
needs, and for multiplying their opportuni- 
ties for happiness and useful service. I have 
been impressed by the opportunity provided 
in this Conference to combine widespread 
public participation with expert help, in a 
common effort to advance the well-being of 
our next generation. I have urged the com- 
mittee to press forward with every resource 
to accomplish this objective and have as- 
sured the committee of my complete support. 

note: The Midcentury White House Conference on 
Children and Youth was held on December 3-7, 
1950, in Washington, D.C. For the President's 
address before the Conference on December 5, see 
Item 299. See also 1949 volume, this series, Items 
198, 204. 

As recorded in the White House appointment 
book, the following representatives of the National 
Committee for the Conference called on the Presi- 
dent on January 6, 1950, at 11:45 a.m.: Mrs. Frank- 
lin D. Roosevelt, Chauncey McCormack, president 
of the Chicago Art Institute, Mrs. David Levy, and 
Katharine F. Lenroot, Chief of the Children's Bureau, 
Federal Security Agency. 



6 Annual Message to the Congress: The President's 
Economic Report. January 6, 1950 



To the Congress of the United States: 

As 1950 opens, renewed confidence pre- 
vails in the American economy. This con- 
fidence is in itself an element of strength; 
and it is justified by the facts. 

Late in 1948 we stood at the peak of the 
inflationary boom. It was clear that an 
eventual adjustment was inevitable before 
we would have a firm basis for stability and 
steady economic growth. During 1949 we 
met the test of that adjustment. Despite 
rough going for a few months, we made 
necessary changes with much less distress 



and difficulty than ever before. Today we 
are on firmer ground than we were a year 
ago. 

Prices are down somewhat, and show the 
relative stability on which firm business and 
consumer plans can be based. Inventories 
of manufacturers and retailers have been re- 
duced, and now are better adjusted to the 
rate of sales. These changes were accom- 
plished with only very small reductions in 
dollar incomes and consumer spending. 
Allowing for price changes, the volume of 
goods and services purchased by consumers 



18 



Harry S. Truman, ig^o 



Jan. 6 [6] 



in 1949 was actually larger than in 1948. 
Business is proceeding with good profit pros- 
pects. Home building in 1949 reached a 
higher level than ever before. 

More important still, employment and pro- 
duction, which declined during the first few 
months of 1949, have in recent months been 
moving upward again. Considerably more 
people now have jobs than at the low point 
last year. Industrial production has in- 
creased by 9 percent since July. Holiday 
sales have hit an all-time peak. 

The relatively safe passage from inflation 
to greater stability was no accident. Busi- 
nessmen, workers, and farmers demonstrated 
much greater judgment and restraint than 
in earlier similar periods. Their actions 
showed that they had gained understanding 
of the causes of our economic situation and 
what should be done to improve it. Their 
efforts were aided by public policies which 
had been developed over the years and had 
been improved by experience. Government 
measures in such fields as credit and bank- 
ing, social insurance, and agricultural price 
supports, proved their worth in cushioning 
the downswing and lending strong support 
to the recovery movement. 

This effective teamwork between free 
enterprise and Government confounded the 
enemies of freedom who waited eagerly, dur- 
ing 1949, for the collapse of the American 
economy. Our economy continues strong. 
We are able to continue and advance the 
domestic and international programs which 
are the hope of free peoples throughout the 
world. 

We have succeeded in avoiding a serious 
set-back in 1949. We have regained stabil- 
ity; but we need more than stability. The 
great motivating force in our economic sys- 
tem is the perpetual will to move ahead, to 
use our skills and our resources more effi- 
ciendy, to produce more at lower cost, and 
to provide a better and richer life for all our 



citizens. The American economy must ex- 
pand steadily. 

Maximum production and maximum em- 
ployment are not static goals; they mean 
more jobs and more business opportunities 
in each succeeding year. If we are to attain 
these objectives, we must make full use of 
all the resources of the American economy. 

During the past year, we did not do so. 
Our success thus far in reversing the forces 
of recession cannot hide the high price we 
paid for economic instability. The down- 
turn brought anxiety and suffering to mil- 
lions who became unemployed, and to their 
families. It brought failure to many small 
businesses. It reduced the opportunities for 
the creation of new enterprises. It hurt the 
free nations whose continuing revival de- 
pends upon trade with us. It caused our 
total output for 1949 to be some 10 to 13 
billion dollars lower than it would have been 
if maximum production and employment 
had been maintained. 

In earlier economic reports, I emphasized 
the dangers of permitting inflationary pres- 
sures to continue, and urged measures to 
hold them in check. Most of these measures 
were not adopted, and the break in the eco- 
nomic boom, against which I had warned, 
came to pass. Six months ago, the Midyear 
Economic Report pointed out the way to 
recovery. Additional steps should now be 
taken to complete the process of recovery. 
We must not again make the mistake of fail- 
ing to adopt aflSrmative policies necessary for 
continued economic stability and growth. 

At present, our economy is moving up- 
ward again. But we have not yet reached 
the point of fully employing our resources. 

Although output is high, some resources 
of plant and equipment are not being fully 
used. Although employment is large, un- 
employment in recent months has been 
about 1 54 to 2 million higher than in the 
corresponding months of 1948. Further- 



19 



[6] Jan. 6 



Public Papers of the Presidents 



more, our technology, productive facilities, 
and labor force are continuing to grow. 

If we are to use all these resources, we must 
tap the dynamic forces of expansion within 
the American economy. One of the most 
important of these dynamic forces is the 
process of business investment, by which 
productive capacity is enlarged and im- 
proved. In the fourth quarter of the year, 
business investment has not kept pace with 
the improvement in economic conditions. 
If the downward trend in business invest- 
ment were to continue, our prospects for full 
recovery and continued expansion would be 
seriously endangered. 

There is no need for this decline to con- 
tinue. There are immense opportunities for 
business investment in nearly every segment 
of the economy. There are in general suffi- 
cient funds available to businessmen who 
want to seize these opportunities. The ini- 
tiative of businessmen, aided by proper Gov- 
ernment policies, can and should soon reverse 
the trend of business investment. 

Business investment can continue at a 
high level only if markets for consumer 
goods continue to expand. Price and wage 
policies should be directed at enlarging these 
markets. For only by broadening the dis- 
tribution of goods and services can our busi- 
ness system find full use for its expanding 
productive capacity. 

The events of 1949 demonstrated anew the 
basic strength of the American economy. 
They also demonstrated that economic affairs 
are not beyond human control. We should 
now seek to establish a course that will com- 
plete the recovery and carry us on to steady 
economic growth. 

SUMMARY OF THE ECONOMIC SITUATION 

Total civilian employment in 1949 aver- 
aged 58.7 million, somewhat less than the 



average of 59.4 million in 1948, and was 
58.6 million in December 1949. Nonagri- 
cultural employment fell during the first five 
months, reaching a low of 49.7 million in 
May. Since that month it has increased at 
more than the usual seasonal rate, reaching 
51.8 million in December. 

Over the year, unemployment averaged 
3.4 million, or about 5 percent of the labor 
force, compared with 2.1 million or 3 percent 
of the somewhat smaller labor force in 1948. 
Unemployment at its worst in July 1949 
amounted to 4.1 million. In December, it 
was just below 3.5 million, 1.6 million more 
than in December 1948. There has been a 
rapid rise in the number of unemployed 
workers exhausting their rights to unemploy- 
ment benefits. 

Total production of all goods and services 
in 1949 was 259 billion dollars. Adjusted 
for changes in prices, this was about i per- 
cent lower than in 1948, and fell short of 
maximum production by 4 to 5 percent, or 
10 to 13 billion dollars. The sharpest drop 
was in industrial production, which averaged 
9 percent lower than in 1948, while agricul- 
tural output dropped about i percent. Con- 
struction advanced about 5 percent, and 
output of electricity and gas rose about 2 
percent. There was a gain in the service 
industries. 

From November 1948, until the low point 
of July 1949, industrial production declined 
17 percent. Since July the trend has been 
upward, interrupted only by work stoppages. 
By December industrial production had 
regained nearly half of the lost ground. 

Prices during the first half of 1949 showed 
a general but moderate decline, followed by 
relative stability in the second half. Whole- 
sale prices by the end of the year were down 
7 percent from their level of a year earlier, 
and II percent below their 1948 peak. The 
sharpest declines were in farm and whole- 



20 



Harry S. Truman, ig$o 



Jan. 6 [6] 



sale food prices. Farm prices are now 23 
percent below the postwar peak and 12 per- 
cent below what they were a year ago. The 
drop in consumers' prices was much more 
moderate. By November 1949, consumers' 
prices had declined 2 percent below the level 
at the end of 1948 and 3 percent below their 
postwar peak. 

Wage increases were received by a much 
smaller number of workers than in previous 
postwar years. There was no general wage 
pattern. Wages averaged slighdy higher 
than in 1948, and consumers' prices were 
somewhat lower. One outstanding develop- 
ment was the growth of pension and social 
insurance plans financed in whole or in part 
by empoyers. 

Wor\ stoppages in 1949 were about the 
same in number as in 1948, but the two 
major stoppages, in coal and steel, involved 
such a large number of workers that the 
loss in man-days of work was about 50 per- 
cent greater than in 1948. 

Profits were lower in 1949 than in 1948. 
For the year as a whole, corporate profits 
before taxes and the inventory valuation ad- 
justment were 27.6 billion dollars, a drop 
of about 21 percent. Much of the loss in 
reported profits represented the effect of fall- 
ing prices on inventory valuation. 

Farm income (realized net income of farm 
operators) declined about 15 percent, reflect- 
ing the decline in prices. The agricultural 
price-support program prevented a much 
sharper decline in prices and incomes. 

Credit terms generally eased during the 
year. Interest rates declined. Business 
loans, reflecting the liquidation of inven- 
tories, declined sharply during the first six 
months but began to advance again in the 
latter part of the year. Instalment credit, 
after a slight decline in the first quarter, 
resumed its advance and reached a new post- 
war peak. Most notable was the more than 



60 percent increase in automobile instalment 
credit during the year. 

Consumers' disposable income was slightly 
higher in 1949 than in 1948, rising from 
190.8 billion dollars to 192.9 billion dollars. 
The trend, however, was different, rising 
every quarter in 1948 and falling every quar- 
ter in 1949. In the fourth quarter of 1949 
the annual rate was 191.1 billion dollars. 
Unemployment compensation in 1949 con- 
tributed 1.9 billion dollars to consumer in- 
come, I billion dollars more than in 1948. 

Consumer expenditures for goods and 
services were remarkably constant through- 
out 1949. Their total was 179 billion dol- 
lars. This was equal to the total for 1948 as 
a whole, but about 2 billion dollars lower 
than the annual rate in the second half of 
that year. Allowing for price changes, con- 
sumers' expenditures represented a slightly 
higher volume of goods and services pur- 
chased than in 1948. An increased propor- 
tion of consumer spending was devoted to* 
purchases of services and durable goods, a 
decreased proportion to the purchase of non- 
durable goods. 

Net personal saving amounted to 14.4 bil- 
lion dollars, compared with 12 billion dollars 
in 1948. During 1949, however, the trend 
of saving was downward, from an annual 
rate of 16.3 billion dollars in the first quarter 
to 13. 1 billion dollars in the fourth. While 
personal saving in 1949 was high by any 
previous peacetime standards, it is estimated 
that about one-third of all families did not 
add to their savings, but instead spent more 
than they earned. 

Private domestic investment in 1949 was 
18 percent below the preceding year, primar- 
ily because of a shift from accumulation to 
liquidation of inventories. By the fourth 
quarter, the liquidation of inventories was 
slowed down, but investment in plant and 
equipment continued to decline. The drop 



21 



[6] Jan. 6 



Public Papers of the Presidents 



in business investment was the principal 
feature in the lower level of economic activ- 
ity in 1949. 

Construction, in spite of a slow start, 
exceeded the high level attained in 1948 by 

3 percent in dollar volume, and was an im- 
portant stabilizing force in the economy. 
Public construction increased by 25 percent 
over 1948. Private construction declined by 

4 percent, but residential construction was 
particularly strong in the second half of the 
year, rising to a new postwar peak in the 
fourth quarter. Housing starts for the year 
exceeded 1,000,000, compared with 931,300 
in 1948. The number of multi-family units 
started was about one-fourth larger than in 
1948. 

By the end of the year, the rate of total 
construction activity was 11 percent higher 
than it was a year earlier, and the backlog 
of contracts had increased considerably. A 
reduction in prices and costs, the easing of 
credit, the expanded authority of the RFC 
to purchase mortgages, and the renewal of 
FHA authority to insure rental projects, all 
contributed to the upsurge. 

Corporate finance reflected the changes in 
the economic situation. The shift from in- 
creasing inventories and increasing customer 
credit in 1948, to inventory reduction and 
a lower rate of increase in customer credit in 
1949, permitted corporations to improve 
their financial liquidity while continuing 
large oudays for new plant and equipment. 
Liquid assets increased by 2.5 billion dollars. 
Short-term debt decreased by 4 billion, but 
long-term debt increased by about the same 
amount. In 1949, internal sources of cor- 
porate funds were larger than required for 
capital investment; in 1948, internal sources 
of funds amounted to only about 70 percent 
of the requirements for capital investment. 

The export surplus (the excess of our ex- 
ports of goods and services over our imports) 
was only slightly lower in total in 1949 than 



in 1948, but it fell sharply in the second half 
of the year. This resulted primarily from 
a sharp drop in our exports of goods and 
services, following severe losses of gold and 
dollars by the countries in the sterling area. 
The devaluation of foreign currencies sub- 
sequent to these losses has so far had little 
effect on our economy. 

Government fiscal transactions in 1949 
helped to stabilize the economy. Cash pay- 
ments by governments — ^Federal, State and 
local — were about 8 billion dollars higher 
in the calendar year 1949 than in 1948. Fed- 
eral cash payments alone were 6.2 billion 
dollars higher. Nearly half of this rise re- 
sulted from the impact of recessionary forces 
on such programs as unemployment compen- 
sation and agricultural price supports, and 
the remainder was mainly the result of larger 
expenditures for international and defense 
programs. The increase in State and local 
cash payments was caused chiefly by higher 
expenditures for schools, roads, and other 
public works. With increasing government 
payments, and with a slight decline in the 
gross national product, the ratio of all gov- 
ernment payments to total output increased 
from about 20 percent in 1948 to 23^4 per- 
cent in 1949. Cash receipts declined pri- 
marily because of the 1948 cut in Federal 
taxes. 

As a result of these changes, the cash sur- 
plus of all governments — ^Federal, State, and 
local — which amounted to over 7 billion 
dollars in the calendar year 1948, became a 
cash deficit of 3 billion dollars in 1949. For 
the Federal Government, the result was a 
shift from a cash surplus of 8 billion dollars 
to a cash deficit of about 1.7 billion dollars. 

UNIFYING PRINCIPLES FOR ACTION 

These facts show our tremendous eco- 
nomic strength. But this strength does not 
rest in material things alone. 



22 



Hatry S. Truman, ig$o 



Jan. 6 [6] 



If we are to continue our economic growth 
the major economic groups must all pull 
together — businessmen, wage earners, and 
farmers must work toward the same ends. 
Government, in turn, must carry out the 
aspirations of the whole people. 

Our success will depend upon the wide- 
spread conviction that all groups have a 
stake in the expansion of the economy — 
that all will share in the benefits of progress. 
In the days ahead we must broaden our 
understanding of how the various interests 
of our people are interrelated. 

Toward this end, I should like to point 
out certain principles on which we can all 
base our economic efforts. The more widely 
these principles are understood, the better 
able we shall be to solve our common prob- 
lems and reconcile the interests of different 
economic groups. The more widely these 
principles are used as the basis for economic 
action and decision, the more rapid will be 
our national progress. 

First. Our economy can and must con- 
tinue to grow. 

An expanding population and an increas- 
ingly productive labor force require con- 
standy expanding employment opportunities 
and steadily rising levels of investment and 
consumption. Within five years, we can 
achieve an annual output in excess of 300 
billion dollars. The gain in national income 
would be equal to an average of nearly 
$1,000 for every family in the United States. 
This would greatly improve standards of 
living. It would go far toward our goal of 
the complete elimination of poverty. It 
would provide employment opportunities for 
about 64 million workers. 

Such prospects are not fanciful. They are 
based upon our long-term record of achieve- 
ment, including some years when we did 
not use fully our resources of plant, mana- 
gerial skills, and labor force. And today, we 



are better equipped with these resources than 
ever before. 

But we will not make this progress within 
five years unless we begin to move in that 
direction now. Our immediate goal for 
1950 should be to regain maximum employ- 
ment. This requires the reduction of un- 
employment to the minimum level consistent 
with labor mobility in a free economy. We 
should strive this year to reduce unemploy- 
ment from 35/2 million to 2 million, or 2^4 
million at most. This would mean about 
61 million civilian jobs. It would mean 
stepping up our national output by about 7 
percent above the 1949 total. These are our 
objectives for this year under the Employ- 
ment Act. If we put forth sufficient effort, 
we can reach these objectives before the 
year's end. 

Second, The benefits of growth and 
progress must extend to all groups. 

Only in this way can the long-run welfare 
of any group be preserved. If any part of 
our economy is depressed, or fails to gain, 
it can only serve as a drag against the gains 
of other parts. There is no room for the 
feeling that one group can prosper only at 
the expense of another. There is abundant 
opportunity for all groups to prosper to- 
gether. Expansion to a 300 billion dollar 
economy within five years would place 30 
to 45 billion dollars more per year in the 
hands of consumers for buying the needs 
and comforts of life. It would provide op- 
portunity for profitable business investment 
in plant, equipment, and housing which 
might run 3 to 6 billion dollars per year 
above the 1949 level. It would enable farm- 
ers to sell about 10 percent more food for 
domestic consumption. 

Third. This growth will not come auto- 
matically, but requires conscious purpose and 
hard work. 

Productivity per worker should be in- 



23 



[6] Jan. 6 



Public Papers of the Presidents 



creased by at least 2 to 2)^ percent a year. 
Labor should base its policies on the prospect 
of a stable and expanding economy. Busi- 
nessmen should base their investment poli- 
cies on confidence in growth, shape their 
price policies to the needs of larger markets, 
and proceed with vigor and ingenuity to 
develop new and better products of all kinds. 
Farmers should make full use of new tech- 
nology, and make shifts in production to- 
ward those commodities most needed in a 
growing peacetime economy. 

To promote an environment in which 
businessmen, labor, and farmers can act most 
effectively to achieve steady economic growth 
is a major task of the Government. It must 
perfect measures for helping to stabilize the 
economy. It must build up the natural re- 
sources which are essential to economic 
progress, and expand the protective measures 
against human insecurity. It must keep 
open the channels of competition, promote 
free collective bargaining, and encourage 
expanded opportunities for private initiative. 

Fourth, The fiscal policy of the Federal 
Government must be designed to contribute 
to the growth of the economy. 

The Federal Budget is an important part 
of the national economy. Wise budgetary 
policies can promote stability and maximum 
production and employment throughout the 
economy. 

In fields such as resource development, 
education, health, and social security. Gov- 
ernment programs are essential elements of 
our economic strength. If we cut these pro- 
grams below the requirements of an expand- 
ing economy, we should be weakening some 
of the most important factors which promote 
that expansion. Furthermore, we must 
maintain our programs for national security 
and international peace. These programs 
are the defense of the world against disaster. 
Upon them, our whole future depends. 



Government revenue policy should take 
into account both the needs of sound Govern- 
ment finance and the needs of an expanding 
economy. Federal receipts should be suffi- 
cient over a period of years to balance the 
budget and provide a surplus for debt re- 
duction. At the same time, the tax struc- 
ture, and the changes made in it from time 
to time, should be such as to promote the 
amounts and types of investment, consump- 
tion, and saving needed for economic ex- 
pansion. We should recognize that the ex- 
pansion of the economy will generate addi- 
tional revenues and strengthen the fiscal 
position of the Government. 

Fifth, We must deal vigorously with 
trouble spots which exist in our economy 
even in times of general prosperity. 

Special measures are needed to help low- 
income groups and, even more important, 
to provide them with better opportunities to 
help themselves. We must deal with the 
particular problems of communities or areas 
which are depressed, or whose economic 
growth has been retarded. Whenever a 
shortage of jobs, or lack of business oppor- 
tunity, affects as many persons as it does 
today, it is a matter for national concern. 
Economic stagnation anywhere is an injury 
to the whole economy. We must direct 
specific measures to these special problems. 

In the light of these guiding principles, 
I turn to the consideration of needed eco- 
nomic policies. 

ECONOMIC POLICIES 

Under our system, private and public poli- 
cies go hand in hand. Private economic 
policies provide motive power of the econ- 
omy. Public economic policies provide the 
framework for economic activity. Sound 
plans for our future grovnh must take ac- 
count of both, and blend them to achieve 
maximum effectiveness. 



24 



Harry S. Truman, ig$o 



Jan. 6 [6] 



Price and wage policies 

The basic economic problem facing the 
country now is not to combat inflation. In- 
stead it is to increase production, employ- 
ment, and incomes to complete the recovery 
from the 1949 downturn, and to go on to 
the higher levels which will be made possible 
by a growing population and rising produc- 
tivity. 

Business policies concerning prices should 
be determined with these objectives in mind. 
In general, prices now seem at or near a 
stable level consistent with continued ex- 
pansion of business activity. There are few 
if any major areas in which price increases 
would be justified under present circum- 
stances. In some outstanding areas, price 
cuts are feasible and needed to maintain and 
expand sales. Furthermore, technological 
progress should in part be reflected in price 
reductions from time to time. 

Wage adjustments are one historic method 
by which buying power has increased with 
increasing productivity. These adjustments 
are now in the hands of management and 
labor. That is where they should remain. 
At the same time, the participants in collec- 
tive bargaining, particularly in dominant 
industries, should recognize that wage ad- 
justments affect not only the employers and 
workers immediately engaged, but also the 
whole economy. 

I am glad to note that the Council of Eco- 
nomic Advisers is encouraging joint confer- 
ences in which representatives of industry, 
agriculture, and labor may together study 
the economic principles underlying maxi- 
mum economic activity. Such conferences 
should be productive of improved policies. 

Business investment 

The large and imaginative programs of 
expansion and modernization of plant facili- 



ties which have been undertaken since the 
war represent a signal achievement by 
private enterprise. The trend of business 
investment, however, has recendy been 
downward, and its continued decline would 
be a cause for real concern. 

There are tremendous business opportuni- 
ties in a growing economy. Not only are 
there more people in our country every year, 
needing food and clothing, homes and house- 
hold equipment, and all the other goods and 
services of our bountiful productive system. 
Even more important, the results of research 
and experience give us every year new and 
better materials and productive methods; 
new products are constandy being developed, 
and whole new industries begun. All these 
changes are continually opening up new op- 
portunities for productive investment. 

There are, in general, ample funds avail- 
able to businessmen who want to expand or 
build new plants, to replace obsolete equip- 
ment, or to extend their operations to new 
geographic areas. Banks are in a position 
to provide funds for sound loans, and inter- 
est rates have been declining. The flow of 
institutional savings, such as insurance 
premiums, is at record levels. Corporations 
as a whole are in excellent financial condi- 
tion. While there are real difficulties facing 
some businessmen, particularly those whose 
enterprises are small or medium-sized, and 
those in certain parts of the country, as a 
whole there is no general financial bar to a 
steady expansion of business investment. 

In order to reverse the present downward 
trend, and to achieve the rising volume of 
business investment consistent with an ex- 
panding economy, businessmen should grasp 
the opportunities which lie ahead; and 
should help to make the adjustments in 
prices and incomes which will translate 
potential markets into real markets. The 
enterprise and imagination of private busi- 



41-355—65 



25 



[6] Jan. 6 



Public Papers of the Presidents 



nessmen will be a crucial factor in achieving 
the upward growth of which our economy 
is capable. 

While our primary reliance should be 
placed upon private initiative, the Govern- 
ment can also help to encourage a reversal 
of the downward trend of business invest- 
ment. The tax recommendations I shall 
transmit to the Congress in the near future 
will, in addition to providing some net in- 
crease in revenue, propose certain changes 
in our tax structure which will make it more 
equitable and stimulate business activity. 

There is a great need to meet the problems 
of small businessmen who cannot now obtain 
adequate financing on reasonable terms. 
New devices for encouraging private finan- 
cial institutions to furnish equity capital to 
small and medium-sized concerns are being 
studied in the Executive Branch, and I hope 
to make recommendations to the Congress 
on this subject during the present session. 
Meanwhile, I recommend that the Recon- 
struction Finance Corporation be authorized 
to increase the maximum maturity of its 
business loans substantially above the pres- 
ent lo-year limit. 

Private housing investment 

Housing is one of the major fields in which 
more investment is required to meet the 
growing needs of our people. The level of 
housing construction in 1949 was only 
slighdy higher than in 1925, despite a much 
larger population. The relative lag of hous- 
ing technology and various outmoded prac- 
tices have resulted in a wide gap between 
the cost of producing good housing and the 
vast potential market for housing to be 
found in the needs and desires of families of 
low and middle incomes. 

The housing problem requires a vigorous 
combination of action by private enterprise 
and by all levels of government. Reduction 
of housing costs, through technical progress. 



better organization, and improved financ- 
ing, is imperative. Aside from public sub- 
sidized housing, further methods must be 
found to enlarge the flow of private capital 
into housing. The Federal Government 
should supplement the comprehensive hous- 
ing legislation, enacted last year, with a new 
program to stimulate the flow of low-cost 
private money into the development of mid- 
dle-income housing, mainly through cooper- 
ative and other non-profit ventures. 

A high level of residential construction is 
an integral part of a generally expanding 
economy, and requires not only direct stimu- 
lation of investment but also continued 
growth in consumer purchasing power. 

Rent control 

While the preceding recommendations 
aim at the fundamental solution of the hous- 
ing problem, the increases in rents which 
would follow a sudden ending of rent con- 
trol would still create severe hardships in a 
large number of areas. It would lift the cost 
of living, impair consumer buying, and com- 
plicate the problem of wage adjustments. 
Therefore I recommend extension of rent 
control for another year. 

Fiscal policy 

At the present time the Federal Budget 
shows a deficit, principally because of the 
drop in incomes and employment in 1949, 
the untimely tax reductions in 1948, and the 
continuing heavy demands of national secu- 
rity programs. As business conditions con- 
tinue to improve, we should bring Govern- 
ment receipts and expenditures into balance, 
and provide some surplus for debt reduction, 
at the earliest date consistent with the wel- 
fare of the country. 

Despite the current deficit, the fiscal posi- 
tion of the Federal Government is basically 
strong. If the trend of business continues 
upward as it should. Federal revenue will 



26 



Harry S. Truman, ig$o 



Jan. 6 [6] 



increase. At the same time, under the poli- 
cies I am recommending in the Budget, Fed- 
eral expenditures should decline somewhat 
over the next few years. This movement 
toward a balanced budget should be acceler- 
ated by changes in our tax laws which will 
reduce present inequities, stimulate business 
activity, and yield a moderate amount of 
additional revenue. 

This reliance upon a combination of three 
factors — an expanding economy, all reason- 
able reductions in expenditures, and a mod- 
erate increase in revenues through changes 
in the tax laws — is the wisest course toward 
a balanced budget. In the long run, the 
Government's fiscal position depends upon 
the health of the national economy. It will 
not be promoted by drastic slashes in ex- 
penditures which are essential to our eco- 
nomic growth and to continued peace. 
Neither will it be promoted by tax increases 
so drastic as to stifle business activity. 
Either action would impair our chances for 
achieving our major national and interna- 
tional objectives and would threaten further 
recovery. 

Credit policies 

To carry out the purposes of the Employ- 
ment Act, the Government should be 
equipped, as a permanent matter, with the 
minimum tools necessary to control the basic 
factors of credit expansion. 

To eliminate the competitive disadvantage 
of Federal Reserve membership, the author- 
ity of the Board of Governors of the Federal 
Reserve System over bank reserve require- 
ments should be revised. The Board should 
have broader powers than it now has to in- 
crease bank reserve requirements in a period 
of inflation. This would be a protective 
measure for the entire banking system, and 
accordingly should be applicable to all banks 
insured by the Federal Deposit Insurance 
Corporation. 



The Board's authority over instalment 
credit ended last June. Since that time the 
excessive relaxation of instalment terms of- 
fered to consumers has demonstrated the 
need for a restoration of the Board's 
authority. 

I have heretofore pointed out the need 
for more effective Government supervision 
over speculative trading on the commodity 
exchanges. I recommend that the Congress 
grant more specific and more adequate au- 
thority for this purpose. 

Farm policy 

A generally pros-perous economy will do 
more than all else to help the farmer. As 
the economy grows, it can absorb an expan- 
sion of total agricultural output, provided the 
necessary shifts in amounts and types of dif- 
ferent products are made to meet the needs 
of a changing peacetime economy. Changes 
in our farm policy are needed to accelerate 
these shifts in production, to check the de- 
cline in farm incomes which has persisted for 
more than a year, and to accord to farmers a 
fair share of the fruits of prosperity. These 
basic objectives of farm policy call for some 
shift of emphasis from the support of prices 
of particular commodities to the support of 
farm income. 

There is also need for additional methods 
of support. Perishable products, in partic- 
ular, cannot be supported satisfactorily by 
loans and purchases alone, and yet these are 
the products the expansion of whose output 
is most desirable. I therefore urge that sup- 
port through production payments be 
authorized. 

Special measures are needed to aid low- 
income groups in agriculture. These in- 
clude measures to provide credit and man- 
agement aids to low-income farmers to help 
them enlarge and improve their farms. 
They include programs to provide rural 
electrification, rural telephones, better farm 



27 



[6] Jan. 6 



Public Papers of the Presidents 



housing, and improved opportunity for 
medical care. In addition, we must continue 
to improve the education of our farm youth 
not only to make them more efficient farmers, 
but also to help some of the underemployed 
people in agriculture find useful work in 
other occupations. 

Increased emphasis should be given to en- 
couragement of types of farming which are 
most needed. Research and education, and 
conservation and credit programs, as well as 
the Government's support of farm prices 
and farm incomes, should be directed toward 
this end. 

Developmental programs and community 
services 

After the restraints imposed by war and 
by postwar inflation. Federal programs for 
resource development, transportation, edu- 
cation, and health are just beginning to ad- 
just to the needs of an expanding national 
economy. Even now, the requirements of 
national security, international aid, and 
veterans' adjustments are so urgent and so 
large that progress in developmental pro- 
grams and community services must neces- 
sarily be limited to gradual advancement at 
a rate below the genuine need. 

Nevertheless, we are continuing to expand 
our investment in the development of our 
rivers for flood control, navigation, reclama- 
tion, and electric power, in the expansion of 
our highways, and in the development of 
atomic energy. I again urge early authori- 
zation of the St. Lawrence seaway and power 
project, which should be started as soon as 
plans can be completed. In most of our 
major river valleys we do not have satis- 
factory means for preparing integrated 
programs of development. I have already 
recommended, and I again urge, that the 
Congress authorize the consolidation of a 
number of Federal activities in the Pacific 



Northwest into a Columbia Valley Ad- 
ministration. 

Present deficiencies in education and 
health are so compelling that I repeat my 
recommendation for new programs. Ex- 
pansion of public health services, and of 
enrollments in schools of medicine, nursing, 
dentistry, and public health, should be 
started now. The growing number of chil- 
dren of school age cannot be permitted to 
delay their education. I therefore urge the 
prompt enactment of aid to elementary and 
secondary education, and the provision of 
funds for a survey to determine the extent 
of the need for school construction. There 
should also be authorized a limited program 
to assist capable young people who are now 
financially unable to secure the higher educa- 
tion essential to the full development of their 
talents. 

Many of the existing procurement, con- 
struction, and loan programs of the Federal 
Government can be adapted, to some extent, 
to alleviate serious unemployment in partic- 
ular local areas. The program initiated for 
this purpose in the summer of 1949 has 
shown some good results and it will be con- 
tinued. It is evident, however, that some 
localities are faced with long-term rather 
than temporary difficulties and that effective 
programs to provide permanent solutions 
need to be worked out. The Federal Gov- 
ernment will continue to use all available 
resources for the aid of such distressed areas 
and, cooperating with State and local agen- 
cies and private groups, will assist in pre- 
paring programs adjusted to the long-range 
problems and opportunities of those areas. 

Social security 

In our growing economy, there can be no 
excuse for failure to develop an adequate 
system for protecting our citizens against 
economic insecurity. As we produce more. 



28 



Harry S. Truman, ig^o 



Jan. 6 [6] 



we can and should make more adequate pro- 
vision for the aged, those who cannot find 
work, and others in our society who are in 
need. 

I urge the Congress to act promptly on the 
recommendations I have made for the ex- 
tension and improvement of social security. 
We must move rapidly toward a compre- 
hensive social insurance system protecting 
nearly all workers — including those em- 
ployed in farming — ^and their families 
against the risks of old age, unemployment, 
disability, death of the family wage-earner, 
and illness. The costs of such a system, 
when measured against the growing output 
of our economv, are well within our capacity 
to pay. 

The present programs of social security are 
grossly inadequate. Because of the limited 
coverage of the present law, and the exhaus- 
tion of benefits by many workers, one-third 
of the unemployed are now receiving no 
unemployment insurance benefits, and in 
some areas the proportion approaches two- 
thirds. Many communities provide no pub- 
lic funds for the relief of jobless workers 
and their families. There are also several 
million disabled workers, many with fami- 
lies to support, who are not eligible for public 
insurance benefits. In some places, they do 
not even receive public relief. Only 650,000 
of the millions of bereaved or broken fami- 
lies with very low incomes are receiving 
survivors insurance. Only 30 percent of the 
aged population are eligible for social insur- 
ance benefits, which are so meager that few 
can retire voluntarily. Needed medical care 
is denied to millions of our citizens because 
they have no access to systematic and ade- 
quate methods of meeting the cost. 

The current inadequacy of the social in- 
surance programs is sharply reflected in the 
disproportionate load now being borne by 
public assistance programs. Increasing 



numbers of the aged, the disabled, and the 
unemployed have been forced to resort to 
public assistance. This distorts the original 
intent of the Social Security Act that people 
are entided to security as a matter of right. 
The burden of public assistance is straining 
the fiscal capacities of State and local govern- 
ments. While enactment of proposed social 
insurance programs will alleviate this prob- 
lem in the future, provision must be made 
for dealing with the problem in the mean- 
time. I therefore urge enactment of the 
proposols which I submitted to the Congress 
last spring for the extension and improve- 
ment of the program of Federal grants to 
States for public assistance. 

International economic programs 

We are now in a transitional stage in the 
development of our international economic 
policies. Our short-run programs of aid to 
friendly countries abroad have begun to bear 
fruit in increased production, expanding 
trade, and rising living standards. At the 
same time, the long-range nature of the 
problems of world production and trade has 
emerged more clearly, and the need for the 
United States to play a continuing role in 
world development through capital and tech- 
nical assistance has become evident. 

The progress already made toward achiev- 
ing the objectives of the European recovery 
program and of other short-run aid pro- 
grams should prompt the continuation of 
these programs on a basis commensurate 
with need. To cripple them now would 
imperil past progress and risk the waste of 
expenditures already made. I recommend 
that these programs be extended on a scale 
sufficient to accomplish the purposes for 
which they were established. 

In the years ahead, we must lay increasing 
emphasis upon long-run international eco- 
nomic programs. We need to move vigor- 



29 



[6] Jan. 6 



Public Papers of the Presidents 



ously toward a world-wide increase of inter- 
national trade. This will result in larger 
imports into our country, which will assist 
other countries to earn the dollars they need, 
and will at the same time increase our own 
standard of living. An immediate step in 
this direction is to approve promptly the 
proposed Charter for the International Trade 
Organization, which has been negotiated to 
establish a code of fair trade practice and a 
means for steadily improving international 
commercial relations. 

Even the maximum feasible reduction of 
barriers to world trade would not alone make 
possible the continued increases in world 
production and living standards which are 
essential to world peace. Such reductions are 
of litde immediate benefit to the underde- 
veloped areas of the world, which cannot 
produce enough to achieve an export surplus 
and build up their productive capital. These 
areas urgendy need improved technical 
knowledge and increased capital investment. 
The aim of the Point Four program for 
assistance to underdeveloped countries is to 
help meet these needs. 

To make the most effective use of invested 
capital, underdeveloped countries require 
technical assitance. Hearings have already 
been held by the Congress on the legislation 
I have recommended to stimulate the inter- 
change of technical assistance. I urge action 
on this proposal as soon as possible. 

The United States has sufficient productive 
strength to provide capital for investment in 
productive developments abroad. In order 
to encourage the private investment of 
United States funds abroad, I urge the Con- 
gress to act promptly on the legislation now 
before it to authorize the Export-Import 
Bank to guarantee such investments against 
certain risks peculiar to foreign investment. 
Through the negotiation of treaties, the Gov- 
ernment is moving to improve conditions 



for investment abroad and assure protection 
for the legitimate interests of United States 
investors. It will also continue to be the 
policy of the Government to encourage 
American investment abroad only when it is 
carried on in a way that protects the interests 
of the people in the foreign countries con- 
cerned. 

I recommend also that certain provisions 
of the tax laws governing the taxation of 
income from foreign investments be revised 
in order to stimulate the flow of American 
capital abroad. 

In addition to its direct contribution to in- 
creased production, the technical assistance 
program should prepare the way for, and 
stimulate the preparation of, concrete de- 
velopment projects, on the basis of which an 
increasing volume of private and public 
investment can be made. It is unlikely that 
private funds, including those invested 
through the International Bank, and the 
present resources of the Export-Import Bank, 
will be sufficient to meet the need for invest- 
ment abroad. It will probably become nec- 
essary at a later time to increase the lending 
authority of the Export-Import Bank. 

SUMMARY OF LEGISLATIVE RECOMMENDATIONS 

I summarize below the legislative recom- 
mendations contained in this Economic Re- 
port, and urge that the Congress enact them 
into law: 

1. Make some revisions in the tax struc- 
ture to reduce present inequities, stimulate 
business activity, and yield a moderate 
amount of net additional revenue. My spe- 
cific recommendations on taxes will be 
transmitted to the Congress at an early date. 

2. Enact a new program to stimulate pri- 
vate investment in housing for middle-in- 
come families. 

3. Substantially increase the maximum 



30 



Harry S. Truman, igp 



Jan. 6 [6] 



maturity period for business loans made by 
the Reconstruction Finance Corporation. 

4. Improve the protection of farm incomes 
and encourage needed shifts in farm produc- 
tion, by authorization of production pay- 
ments and other changes in present legisla- 
tion. 

5. Establish a Columbia Valley Adminis- 
tration, and authorize the St. Lawrence 
seaway and power project. 

6. Provide for Federal aid to elementary 
and secondary education, for a limited pro- 
gram of aid in support of higher education 
for capable students, for aid to medical edu- 
cation, for the improvement of local public 
health services, and for grants to States for 
surveys of the need for school construction. 

7. Extend and liberalize the social security 
structure by improving old-age, survivors, 
and unemployment insurance, enacting dis- 
ability and health insurance, and expanding 
Federal grants-in-aid to States for public 
assistance. 

8. Extend rent control for another year. 

9. Continue the foreign recovery programs 
on a basis commensurable with need. 

10. Approve the Charter for the Interna- 
tional Trade Organization. 

11. Authorize the program for technical 
assistance to underdeveloped countries, and 
for guarantees by the Export-Import Bank 
against risks peculiar to private investment 
abroad; and revise certain provisions in the 
tax laws governing the taxation of income 
from foreign investments. 

12. Provide additional authority over 
banking reserves to the Board of Governors 
of the Federal Reserve System; extend that 
authority to all banks insured by the Federal 
Deposit Insurance Corporation; and restore 
the Board's authority to regulate consumer 



credit. Provide authority to regulate specu- 
lation on the commodity exchanges. 
***** 

In the Message on the State of the Union, 
I have stressed the fateful role which the 
United States has come to occupy in the 
progress of human destiny. Our responsi- 
bilities are already determined by the course 
of world events. But how well we measure 
up to these responsibilities remains in our 
own hands. 

Moral leadership comes first, as we seek 
to inspire free men everywhere with con- 
fidence in their cause. But history proves 
that many great moral purposes have failed 
or faltered because the material strength to 
support them was lacking. The economic 
power of the United States, at its full poten- 
tial, is the keystone of this support. 

The Congress foresaw this when it gave 
our national economic policy the degree of 
central significance accorded to it under the 
Employment Act of 1946. As the delibera- 
tions of the United Nations demonstrate, 
other nations recognize the overwhelming 
importance to the cause of freedom of wise 
economic policies and full employment. 

Our economic situation today is good, and 
it can be better. The lessons of the past and 
the magnificent challenge of the future con- 
tinue to spur us on. For all to thrive and 
prosper together, all must work together — 
with mutual understanding and common 
purposes. That is the spirit of our democ- 
racy. That is the spirit in which I transmit 
these recommendations to the Congress, and 
to all those whose actions affect our economy. 
Harry S. Truman 

note: The message and the complete report are 
published in "The Economic Report of the President 
Transmitted to the Congress, January 6, 1950" 
(Government Printing Office, 1950, 194 pp.)» 



31 



[7] Jan. 6 



Public Papers of the Presidents 



7 Exchange of Messages With Michael, Orthodox Archbishop of 
North and South America. ]anuary 6, 1950 



IN RESPONSE to your appeal, I am glad 
to assure you that the United States will 
continue to give the utmost support to the 
efforts of the United Nations and the inter- 
national Red Cross organizations to bring 
about the return to Greece of the thousands 
of children removed from that country to 
eastern Europe during the course of the 
recent guerrilla v^arfare. The people of the 
United States, and particularly the mothers 
of the United States, are deeply sensitive 
to the plight of these children and their 
bereaved families. We pray that the Gov- 
ernments of the countries harboring these 
children v^ill be moved by a spirit of broad 
humanitarianism to cooperate in fulfilling 
the unanimous desire of the United Nations 



General Assembly that these children be 
promptly restored to their homes. 

Harry S. Truman 

note: Archbishop Michaers message, dated Decem- 
ber 28, 1949, follows: 

Just from Greece as the new spiritual leader of 
the Greek-American Orthodox people in your and 
our prosperous and beloved country, I make today 
an appeal to the civilized humanity and generous 
American people for the return to their parents of 
the abducted Greek children. Our Orthodox people 
here and in Greece who are so grateful to you and 
to the American people for all given assistance will 
count very much on your personality. Will you 
please exercise all your high influence upon the 
members of the United Nations so that these Greek 
children are returned to their homes. 

Michael, 
Archbishop of North and South America 



8 The President's News Conference on the Budget. 
January 7, 1950 



[As the conference opened, Charles G. Ross, Press 
Secretary to the President, made the following state- 
ment: "As you all kpow, this seminar is just for your 
guidance, for hack^round purposes, and not for 
attribution. And when you as\ your questions, will 
you please always refer to the page number of the 
Message."'] 

THE PRESIDENT, [i.] I would like to tell 
you first about this group of charts here. 
Has everybody got one of these charts? 

If you will notice, the first chart points 
out the receipts and expenditures, where they 
come from and where they go. Then there 
is this chart here, which shows the reverse 
of it, the way the distribution of expenditures 
is made — since 1939 — which is exacdy re- 
verse — very informative. And the next one 
shows where the money comes from and 
where it goes; and the next one is on the 
same line. That last one is the big one — 



where I was pointing to in the pictures they 
just took — it shows what happens in an 
emergency like we have been through since 
1938. And the last end of that chart shows 
what we are trying to do to keep from get- 
ting that big a hump again. 

I want to call your attention particularly to 
part 3 in this green book, which gives you 
some idea of the Government's assets and 
investments made over the years, which has 
not before been pointed out. All these 
people that yell about expenditures don't 
understand that a tremendous amount of the 
expenditures we make is an investment in 
the United States of America, and if those 
investments were not made we would not be 
on the income basis that we are on now, so 
far as the individual and the business of the 
country is concerned. 



32 



Harry S. Truman, ig^o 



Jan. 7 [8] 



I think those are all the preliminary re- 
marks that I want to make. 

Mr. Ross: Mr. President, may I say again 
that these remarks are for guidance and for 
background purposes, not for attribution, 
which is customary at these seminars. 

THE PRESIDENT. He wauts me to impress 
on you that these statements that I make are 
for guidance and background and not for 
personal attribution to the President. I think 
all of you understand that, particularly those 
who have been here before. 

Mr. Pace: You might also ask that when 
they ask a question that they refer to the page 
number. 

THE PRESIDENT. The Budget Director 
wants the page number referred to when 
you ask a question, and it will make it easier 
for us to answer. You can proceed now. 

[2.] Q. Mr. President, on page M78 
(p. 99)^ you have a reference to Federal re- 
insurance for unemployment compensation, 
I believe the amount is about $i2i/2 million. 
Does that represent an amount of money to 
be actually made available for payment of 
unemployment compensation benefits? 

THE PRESIDENT. The Budget Director will 
answer that. I wish you would stand up 
when you ask your questions so that we can 
hear you better. 

Mr. Pace: Could you repeat that question, 
please? 

Q. Yes. On page M77, M78, M85, and 
A83 (pp. 99, 100, 105) you will find refer- 
ences to a Federal reinsurance program for 
unemployment compensation, part of that 
administration, part of it compensation. I 
wonder whether the bulk of that is money 



^Page references in parentheses, throughout this 
news conference, indicate where the subjects re- 
ferred to may be found in the Budget Message as 
printed in Item 9, below; all other page references 
correspond to the page numbers in the Budget as 
published in House Document 405 (8ist Cong., 2d 
sess.). 



actually to be made available to pay unem- 
ployment compensation benefits? 

Mr. Pace: The answer to that is it would 
be, if the States need it. 

Q. It wouldn't? 

Mr. Pace: Would be. 

Q. In that answer, how can you tell me 
how much is administration and how much 
for benefits? 

Mr. Pace: Almost entirely for benefits. 

[3.] Q. Now, you mention that there are 
one or two States where the reserve may be 
exhausted by next fall, or shortly thereafter. 
Would you name those States? 

Mr. Pace: We can give you those over 
in the office, when you come over. 

Q. Thank you. 

[4.] Q. Mr. President, on page M21 
(p. 57), under assistance to China, you have 
got nothing down for 1950, and, if I have 
got the right program, I think Congress 
voted 75 million. Is this an indication 

THE PRESIDENT. Yes, I have still got that 
$75 million locked up in the drawer of my 
desk, and it is going to stay there. 
[Laughter] 

John ^ says he might break the desk down. 

[5.] Q. Mr. President, I would like to 
ask one for the record. How much is a 
moderate tax increase? 

THE PRESIDENT. I wiU auswer that ques- 
tion in the tax message, in language so that 
you can understand it without a bit of 
trouble. 

Q. Mr. President, when does the tax mes- 
sage go to Congress? 

THE PRESIDENT. We are preparing it right 
now. I hope it will be ready in a few days. 

Q. Will it go Monday? 

THE PRESIDENT. I Cau't — UO, it WOu't gO 

Monday. This message only will go down 
on Monday. 
Q. What I mean is, we are writing stories 

^ Secretary of the Treasury John W. Snyder. 



41-355—65- 



33 



[8] Jan. 7 



Public Papers of the Presidents 



today on the budget. Will the tax message 
come along Monday to change the lead for 
the story? 

THE PRESIDENT. No, no. You Spend your 
time on the budget, and there will be plenty 
of time to work on the tax message. We 
are going to have it ready just as prompdy 
as we can.^ 

[6.] Q. Mr. President, on occupied re- 
lief — ^ERP — ^how much is ERP in this 3,250,- 
000 — ^3 billion — that is, M21 (p. 57)? 

Mr. Pace: The answer to that is that the 
German relief is included in ERP this year. 
Last year it ran approximately 400 to 450 
million. This year, then, would obviously 
run slightly less than that if it were set out 
as a separate category; but it is included in 
ERP operations this year. 

Q. That would reduce ERP about 2 
billion, eight? 

Mr. Pace: If it were set out independ- 
ently — I can't specify exactly how much goes 
for Germany because there would be some 
reduction last year. If you used last year's 
figures it would make it about that amount, 
but that is not an exact figure for this coming 
year. 

Q. What is the correct figure, then, to use 
for the amount to be asked for, for ERP for 
the economic 

THE PRESIDENT. It is Set out right there. 

Mr. Pace: The figure set out here, because 
that is one of ERP's responsibilities this year. 
In other words, if you were going to show 
that Germany was actually included in ERP, 
you could state what part of the actual figure 
of ERP is the one set out here. 

[7.] Q. Mr. President, on page M36 (p. 
68), the last sentence of the next to the last 
paragraph is very interesting: "We should 
provide through the veterans' programs 
only for the special and unique needs of vet- 

MtemiS. 



erans arising direcdy from military service." 
Can that be taken as a recommendation to 
repeal laws concerning nonservice-connected 
disabilities? 

THE PRESIDENT. That sets out exactly what 
it means right there. 

Q. That would very greatly reduce vet- 
erans administration costs? 

THE PRESIDENT. Not Very greatly. It 
would reduce it, to some extent, but it would 
prevent it from piling up at a terrific rate, 
which we anticipate later. 

Q. Would also relieve largely the pressure 
on veterans hospitals ? 

THE PRESIDENT. Yes, to some extent it 
would. 

Q. Thank you, sir. 

Q. On that very point, is this not an 
argument against general pension legisla- 
tion? 

THE PRESIDENT. Yes. Yes, that is exacdy 
what it is for. That is exacdy what it is for. 
We would all be paying pensions to our- 
selves if this thing gets spread out too thin. 
The Budget Director calls attention to the 
fact that it has been the policy all along, that 
sections of the GI bill of rights legislation 
to stop — heads off the general pension plan. 
I think it has done a remarkable job for the 
returned veterans, and I think they all think 
so, too. 

[8.] Q. Mr. President, this— the ques- 
tion of policy, do you have any personal 
objection, or any administrative objection, to 
Congress handling your Budget in a single 
appropriation bill? 

THE PRESIDENT. The Cougress has been 
discussing that matter for quite some time. 
I would be perfccdy happy if they would 
take this budget and pass it as a whole, just 
like it is. [Laughter'] 

Q. Mr. President, that was hardly the in- 
tent of the question. 



34 



Harry S. Truman, ig§o 



Jan. 7 [8] 



THE PRESIDENT. I didn't Understand you? 

Q. That was hardly the intent of the ques- 
tion. [More laughter] 

Q. Mr. President, you said you were going 
to submit about $7 biUion in estimates later, 
and about $33 billion at this time. I think 
that is 

THE PRESIDENT. No, this is the budget 
right here before you. This is the budget 
we — that we are submitting. This is the 
budget document here that goes to Congress. 
I don't think there is anything in addition to 
this green book. 

Q. My question was, how would that af- 
fect the single package appropriation bill? 

THE PRESIDENT. I dou't think it would 
affect it at all. I don't think it would affect 
it at all. That is a matter for Congress itself 
to decide. I can't tell them how to handle 
the budget. All I am interested in is that 
they don't treat it as they did last year. A 
lot of them have to be elected this year and 
they had better get that appropriation bill 
through in a hurry. 

[9.] Q. Mr. President, will you accept a 
single package bill with the item veto? 

THE PRESIDENT. I havc always been in 
favor of the item veto. It requires, I under- 
stand, a constitutional amendment to have 
an item veto, and I don't think there is any 
possible chance of getting that in this budget, 
or any other one for several years to come. 

[10.] Q. Mr. President, getting back to 
the overall figure, please, on page M5 
(p. 45) — the digest figures for the 195 1 
budget. 

THE PRESIDENT. YeS? 

Q. 42,439 — ^that is existing and proposed 
legislation? 

THE PRESIDENT. That's right. That is the 
whole thing, existing and proposed legisla- 
tion. 

Q. That, of course, does not include the 



social security collections and payments? 

THE PRESIDENT. Oh no, that is a separate 
account. 

Mr. Pace: It does include railroad retire- 
ment. 

Q. It does include it? 

Mr. Pace: It does include railroad retire- 
ment. That is included in the trust funds. 

Q. Then the 37.3 of revenue is without 
any anticipated change in the — ^without 
change in the existing 

THE PRESIDENT. That is cotrect. 

Mr. Pace: That is correct. 

THE PRESIDENT. What is it? 

[11.] Q. Mr. President, on page M43 
(p. 73), in relation to social security, you 
say, "The greater part of them would be 
financed through special taxes. . . ." What 
kind of special taxes do you mean? 

Mr. Pace: Payroll. 

THE PRESIDENT. Payroll taxes, that is what 
is referred to. 

Q. Payroll taxes ? 

THE PRESIDENT. That's right. 

Q. Mr. President, page M48 (p. 77), you 
propose that a payroll tax of one-fourth of i 
percent be placed on employers and em- 
ployees effective January i, 1951. Does the 
receipts side of the cash budget reflect that 
increase, and the increase in health 
insurance? 

THE PRESIDENT. Budget wiU have to 
answer that. 

Mr. Pace: The answer to that is that it 
would be reflected in the cash budget, but 
would not be reflected in this budget, which 
is known as the conventional type budget. 

Q. But it is reflected in the cash budget 
that you have in the statement? 

Mr. Pace: That is correct, yes. That is 
correct. 

[12.] Q. Mr. President, on pages M68 
and M69 (pp. 92, 93), there is a discussion 



35 



[8] Jan. 7 



Public Papers of the Presidents 



of the high subsidies for the United States 
Maritime Commission for shipbuilding. 
My question is whether the issue, or whether 
the subject of the effect of the deflation of 
British currency on shipbuilding and ship- 
building subsidies was considered in sum- 
ming up this question? 

THE PRESIDENT. We work in American 
dollars entirely. 

[i3«] Q' ^^' President, on that — right 
across the page, M69 (p. 93) — you have got 
proposed legislation for the postal deficit, 
395 minus. Apparently that refers to legis- 
lation for increasing the postal receipts on 
mail, not subsidies? 

THE PRESIDENT. That's right. 

Q. Have they worked that out yet? 

Q. It was 250. You said that was not 
enough. 

THE PRESIDENT. No, it is not euough. It 
is increasing all the time — all the time. 

Q. Have you worked that out? 

THE PRESIDENT. The Postmaster General, 
I think, has the figure all ready to send to the 
Congress. 

Mr. Pace: I think he is working on it at 
the present time. 

THE PRESIDENT. The Budget Director says 
that the Postmaster General is working on it 
at the present time, but I have discussed the 
matter with the Postmaster General and I 
know that he is going to ask for what it takes 
to meet that deficit. 

Q. Have you talked to the congressional 
leaders about it? 

THE PRESIDENT. Yes, I have. And I have 
also talked to a number of newspapermen, 
and some commentator fellows, and fellows 
who have the right idea think that it ought 
not to be a subsidy. The thing has run at 
nearly $3 billion over the last 20 years. 
Those fellows using the subsidies — that's all 
right for them — ^but they yell about some 
other subsidies. I think they, too, ought to 
be met. [ Laugh ter ] 



[14.] Q. Mr. President, this is probably 
a question for the Budget Director: what is 
the cash budget? 

THE PRESIDENT. We have that argument 
every year. The cash budget is what — the 
cash payments 

Q. I mean the figures. 

THE PRESIDENT. that the Government 

has to pay out — ^that the Government has to 
pay out over previous years. 

Q. You didn't understand my question 
properly. 

THE PRESIDENT. All right, give it to him. 

Q. The overall figure, outgo and income? 

THE PRESIDENT. All right, we will give it 
to you. 

Mr. Pace: If they will go on with the 
questions 

THE PRESIDENT. Go ahead with the ques- 
tions. As soon as we get the figures we 
will come back and answer you. 

[15.] Q. M85 (p. 105)— Inland Water- 
ways Corporation — $3 million — I can't find 
it in the big budget. 

THE PRESIDENT. It must be in there. 

Q. No, it isn't — ^550 in the big budget. 
It is apparendy new legislation? 

THE PRESIDENT. On M85 ? 

Q. Under Transportation and Communi- 
cation — Inland Waterways Corporation — 
estimated expenditures — ^$3 million? 

Mr. Lawton: That is to raise capital stock. 

Q. What are you going to do with it? 

Mr. Lawton: Improve facilities of the In- 
land Waterways Corporation. 

Q. That has not been approved by Con- 
gress — not authorized? 

Mr. Lawton: Not yet. 

Q. It has not been authorized? 

Mr. Lawton: No. 

THE PRESIDENT. I don't think it has been 
authorized, but we are asking for it here. 

[16.] Mr. Pace: The answer to the previ- 
ous question, Mr. President, is that the 
whole figure is set out on page A117 — ^the 



36 



Harry S. Truman, ig^o 



Jan. 7 [8] 



whole summary and supporting tables — on 
table 13 on page A117 of the cash budget. 
That will answer not only your final ques- 
tion but any detailed questions, on page 
A117. 

Q. $45 billion against $43 billion? 

Mr. Pace: That's right. 

Mr.Lawton: That's correct. 

[17.] Q. Mr. President, on page M85 
(p. 105), on your proposed legislation there is 
an item of half a million dollars for research 
in utilization of salt water; and on another 
page, under national resources, the same item 
is listed at a million dollars. I wonder if 
those could be reconciled? 

THE PRESIDENT. Can you reconcile them, 
Mr. Budget Director? 

Mr. Pace: The answer on that is that 
unfortunately in your tables you have to 
round the figures, and this is purely a ques- 
tion of rounding. The statement and your 
tables is a rounded figure. The statement 
in your direct quotations is an accurate 
statement. 

Q. Which one is the one that will be used, 
Mr. Pace? 

Mr. Pace: The one in the text and not in 
the tables. 

Q. The one not in the list of proposed 
legislation? 

Mr. Pace: That is correct. 

Q. That would be a million dollars, then? 

Mr. Pace: That is correct — that is correct. 

[18.] Q. Mr. President, can you tell us 
the figure of the national income? 

THE PRESIDENT. $212 billioU. 

Q. Is that for both fiscal 1950 and 195 1? 

Secretary Snyder: That is correct. Aver- 
age annual personal income paid to the indi- 
vidual. 

Q. 212? 

Secretary Snyder: 212. 

Q. Is that for fiscal 

Secretary Snyder: 195 1, and also in the 
adjusted figure for 1950. 



[19.] Q. Mr. President, what is the prob- 
able figure on total national output on what 
we call national income ? That is a different 
figure from the personal income figure. 

THE PRESIDENT. That includcs corpora- 
tions, and everything. I think the total 
figure includes all income — this is personal 
income. 

Q. Comparable figure to the one used in 
the Economic Report? 

THE PRESIDENT. Between 255 and 260 
would be your figure that you are talking 
about. 

[20.] Q. Right along that line, what 
level of employment or unemployment are 
you assuming? 

THE PRESIDENT. That is set out in the 
Message on the State of the Union, and I 
would invite you to read it.* 

Q. Yes, sir. 

[21.] Q. This budget, then, is predicated 
on no change in personal or national income 
in this coming fiscal year? 

THE PRESIDENT. That is correct, at present 
levels. 

Q, At present levels. 

[22.] Q. Mr. President, is your ERP 
given here a final estimate, or is that subject 
to change? 

THE PRESIDENT. It is subjcct to changc, of 
course. 

Q. Well, Mr. President, you said it's on 
present levels. On A4 

THE PRESIDENT. A4? 

Q. Yes — direct taxes on individuals is 
higher in 195 1 estimate than in 1950 esti- 
mate. Apparently you think 195 1 is going 
to be better than 1950? 

THE PRESIDENT. Well, I hopc it wiU be. 

Q. You just said it was based on 212? 

THE PRESIDENT. Right. 

Q. Well, how do you get the difference? 
Secretary Snyder: Well, there are a num- 
ber of adjustments there that in the 1950 — 
* Item 2. 



37 



[8] Jan. 7 



Public Papers of the Presidents 



in making the adjustments, that changed 
the taxes. 

Q. It might be that you had a coal or steel 
strike which would cut down corporation 
incomes in 195 1? 

Secretary Snyder: We certainly don't 
want one. 

Q. Has that been taken into considera- 
tion? 

Secretary Snyder: That has been shown 
in the corporate profits, and in the individual 
incomes. 

[23.] Q. Mr. President, I need clarifica- 
tion on page M84 (p. 104) — estimated ex- 
penditures for European recovery. The fig- 
ure is given as i billion, 7. 

THE PRESIDENT. I didn't Understand your 
question. Please repeat it. 

Q. I would like to have clarification of 
the figure of i billion, 7 — estimated 1951 
expenditures on European recovery program 
and other foreign aid? 

Mr. Pace: That is the part that comes out 
of the new appropriations. The other is 
carryover appropriation, making the two 
totals the same. In other words, this is the 
new part that will come out of the new 
appropriation. A large part will be carry- 
over from old appropriations. Thus a mil- 
lion, 550 will be a carryover from old appro- 
priations. This will be the amount of 
expenditures that will come out of appro- 
priations asked this year. 

Q. Thank you. 

Q. Mr. President, then the only new 
money is that on page i, I guess it is — ^40 
billion — 

THE PRESIDENT. Which page is that ? 

Q. M5 (p. 45), I guess. 

THE PRESIDENT. That's right. 

Q. One more question, is that $25 million 
item in there the only immediate expendi- 
ture contemplated for point 4 ? 

THE PRESIDENT. YeS. 

Q. $45 million. 



THE PRESIDENT. YeS. 

Q. Thank you. 

THE PRESIDENT. The Budget Director calls 
attention to the fact that the operational 
figure for 1951 is substantially below the 
operational figure for 1950 — about $3 bil- 
lion — ^which would have its effect on future 
years. 

Q. Mr. Pace, could I come back to that 
question about that billion, 7 on ERP? I 
am still mixed up about that. Does that 
billion, 7 come out of the 3 billion, i total 
new appropriations? 

Mr. Pace: That's right. That's right. 
That is the part that will be expended out 
of that cash payments. That's the distinc- 
tion between these payments and appropria- 
tions. Thus, appropriations for the 3 
billion, 2 and the i billion, 7 is the amount 
of money that will actually be paid out in 
the year 195 1 out of that new appropriation. 

Q. Where does the balance come? 

Mr. Pace: The balance comes from 1950. 

Q. From the 1950? 

Mr. Pace: That's right. It's a carryover 
there, as it always is, which is the really 
confusing thing about this Federal budg- 
etary process. 

[24.] Q. Do you have an expenditure 
breakdown for the Army, Navy, and Air 
Force? 

THE PRESIDENT. YeS. 

Q. There is an appropriation breakdown 
which I couldn't find — an expenditure 
breakdown. 

THE PRESIDENT. You wiU find a table in 
there — ^when I was running through it last 
night — ^I think table 8 covers it. You will 
find that under different headings in all the 
Government. You will find it under table 8. 

Mr. Pace: Table 8— -A63. 

THE PRESIDENT. 63 — A63 — ^you will find 
all those things covered in every branch of 
the Government in table 8. 

[25.] Q. Mr. President, on M18 (p. 54), 



38 



Harry S. Truman, ig^o 



Jan. 7 [8] 



second paragraph, "In 195 1, about $2.5 bil- 
lion of the increase in the debt will be 
financed by new investments in Federal secu- 
rities by trust accounts and other Govern- 
ment agencies." Does that mean that 2 
billion, 5 will be asked by public financing? 
Is that the only other way you can get it? 

Secretary Snyder: That is the difference, 
yes. 

Q. New public financing? 

Secretary Snyder: That is correct. 

Q. Will the war bonds meet that, or will 
that — not war bonds, savings bonds— — 

Secretary Snyder: Savings bonds. 

Q. Yes. 

Secretary Snyder: We have not deter- 
mined what category — whether short term, 
long term, or intermediate term, but 

Q. Public. 

Secretary Snyder: ^if the necessity for 

additional funds comes up, we will give con- 
sideration to additional types of securities. 

Q. Mr. Secretary, you will expect the sav- 
ings bonds to take as much of that as possi- 
ble, will you not? 

Secretary Snyder: Well, the savings bond 
is of course part of our overall financing 
program, and they have been effectively 
carrying a pretty good part of the general 
distribution of our sales, because up to right 
now we are still selling more savings bonds 
than the redemptions are taking out. 

Q. On page M 

Secretary Snyder: We are not using sav- 
ings bonds to any specific purpose. It is just 
part of the general revenue of the budget. 

THE PRESIDENT. What is it you want to 
ask? 

[26.] Q. M31 (p. 64):— "While no new 
obligational authority is recommended in 
this Budget" for ships — new ships — I imag- 
ine they go 2 or 3 years ahead, don't you, 
on laying keels, etc.? 

THE PRESIDENT. YeS. 



Q. But no new ships contemplated under 
the budget? 

THE PRESIDENT. That is correct — that is 
correct. 

[27.] Q. Mr. President, is there anything 
in the message to indicate when you expect 
to balance the budget, in what year? 

THE PRESIDENT. No. No, I am uot that 
much of a prophet. 

[28.] Q. Well, Mr. President, the Budget 
Director said that the obligations would 
be about $3 billion — ^request for obligations — 
about $3 billion less than last year. Can you 
give us a breakdown on which specific items 
were cut down? 

Mr. Pace: I can't give it to you here. I 
can give it to you over at the oflSice. I think 
probably it is set out in the table here. 

THE PRESIDENT. It's iu oue of these tables — 
I saw it — but I can't remember which one. 
It is set out in one of those tables. 

Mr. Pace: If you will take a look at table 
3 — ^pardon me — on pages 96 and 97 — ^it will 
give you the general picture. Take a look 
at the recap on A7, it will give you the 
figures you need. 

[29.] Q. Mr. President, in looking over 
Treasury, I was unable to determine any 
item that would show the cost of the silver 
purchase program during the year. Is that 
broken down in any way in the budget? 

THE PRESIDENT. Did you use those figures? 

Mr. Pace: We haven't got a breakdown of 
that in here, no. 

[30.] Q. How much additional revenue, 
Mr. President, would the proposed payroll 
tax increase on January i, 1951, bring in? 

THE PRESIDENT. I cau't tell you offhand, I 
don't know. The Budget Director can get 
it for you. 

Mr. Pace: Yes, I can get that. 

[3^*] Q« M^' President, on page Mi 8 
(p. 54), coming back to the reference to 
$254 billion, new investments by Govern- 



39 



[8] Jan. 7 



Public Papers of the Presidents 



mental agencies, does that mean that the 
proposed tax increase would have an upper 
limit of 2.6 to meet the i.i deficit? 

THE PRESIDENT. I wiU auswer that in the 
message on taxes which I am getting ready 
right now. 

[32.] Q. Mr. President, on page A49, 
Federal Security Agency, public health, aid 
to local public health, etc., are those figures 
all based on the three bills now in the 
Congress? 

Mr. Pace: That is correct. 

THE PRESIDENT. That is correct. 

Q. Will you have that again? 

THE PRESIDENT. You Wanted to know if 
these figures for the public health on page 
A49 were based on pending legislation? 
They are. 

Mr. Pace: That is correct. 

[33'] Q- M^' President, on page 1114, 
the special section you refer to in the begin- 
ning 

THE PRESIDENT. YeS. 

Q. on investments, you have a figure 

in the first paragraph of page 1114 of 8.7 
billion for Federal assets. In your message 
on page Mi 2 (p. 49), you have a figure of 5.6 
billion. Is the only difference that the mili- 
tary public works are excluded? 

THE PRESIDENT. The budget will have to 
answer that for you. 

Mr. Pace: Military public works and 
equipment are excluded. 

Q. That is the only difference? 

Mr. Pace: That's right. Although they 
are returnable, they are separated for the 
purposes of determining what actually is a 
return on the investment. 

[34.] Q. Mr. President, I would like to 
get this cleared up. On page M57 (p. 84), 
about two-thirds down the page, "As a step 
toward correcting this situation, I shall trans- 
mit to the Congress a legislative proposal to 
authorize a limited Federal program to assist 
capable youth who could not otherwise do 



so to pursue their desired fields of study at 
the institutions of their choice." Those are 
Federal scholarships? 

THE PRESIDENT. M57? Wait a miuute, I 
haven't found it yet. 

Q. About two-thirds down. 

THE PRESIDENT. "This Budget includes 

Q. No, the sentence above that. 

THE PRESIDENT. "As a Step toward cor- 
recting this situation, I shall transmit to the 
Congress a legislative proposal to authorize 
a limited Federal program to assist capable 
youth who could not otherwise do so to 
pursue their desired fields of study at the 
institutions of their choice." This is about 
as plain as I can make it. 

Q. Federal scholarships? That's a new 
one on me. 

Mr. Pace: It's higher education. 

Q. I know. College education. 

Mr. Pace: That's right. 

Q. Any plans worked out for that — who 
will get it? 

THE PRESIDENT. No. 

Q. How it will be distributed? 

THE PRESIDENT. The details have not been 
worked out. 

Q. Has the amount been decided on ? 

THE PRESIDENT. No. The cxact figure has 
not been worked out. 

Q. Going to be, then, a sort of informa- 
tion on the national education? 

THE PRESIDENT. When we get the details 
worked out, I will give it to you in a printed 
statement of what I hope to do. 

Q. Does the budget include that figure, 
sir? 

THE PRESIDENT. A million dollars. In- 
cludes a million dollars. 

Q. Only a million? 

THE PRESIDENT. That's Hght. 

Mr. Pace: That is just to establish the 
organization. 

Q. How many do you expect to take care 
of? 



40 



Harry S. Truman, ig$o 



Jan. 7 [8] 



THE PRESIDENT. That is to sct Up the or- 
ganization. Don't expect to take care of a 
one. 

Q. Well then, will that not be, sir, an 
additional budget figure, an additional ap- 
propriation upon the budget? 

THE PRESIDENT. It might be. Whenever 
it gets into operation. Of course, it is not 
in this budget. I don't think we will have 
any call for it in this budget. But it will 
be added to the budget whenever we are 
ready to operate. 

Q. In other words, operations will begin 
after fiscal year 195 1 ? 

THE PRESIDENT. I think SO. 1952. It sets 
out in M57 (p. 84) that it might begin in 
fiscal year 1952. 

Q. Mr. President, Mr. McGrath ^ of the 
Office of Education has recommended $300 
million for that program annually. Are you 
prepared to go that high for it? 

THE PRESIDENT. I am not prepared to make 
any statement on the subject now. 

[35-] Q' J^r« President, on page M29 
(p. 63), you refer to the maintenance of six 
Marine Corps battalion landing teams. 
Does that indicate a change in the status of 
the two divisions? 

THE PRESIDENT. Will you repeat that ques- 
tion? 

Q. On page M29 (p. 63), you refer to 
maintaining six Marine Corps battalion 
landing teams. Does that indicate abolish- 
ment of the two divisions they now have? 

THE PRESIDENT. I think you will have to 
ask that question of the Secretary of Defense. 
I myself can't answer it. 

[36-] Q« Mr. President, on M80 (p. 
10 1 ) — that chart — Bureau of Internal Reve- 
nue, Treasury — ^$253 million — is that for the 
checking up of income tax returns? 

THE PRESIDENT. That's right. It's for en- 
forcement. Additional employees for en- 
forcement. 



''Earl J. McGrath, Commissioner of Education. 



Q. That is a — it has not been authorized 
has it, that is my recollection? 

THE PRESIDENT. It has been asked for in 
present appropriations, but it has not been 
authorized yet. 

Q. Mr. President, is that 3,000 additional 
employees? 

Secretary Snyder: Approximately 3,000. 
It's 2,960, something like that. Approx- 
imately 3,000. 

THE PRESIDENT. It wiU bc a good invest- 
ment for the Government. I think we will 
take in a billion or a billion and a half more 
in taxes if we get that through. 

[Long pause here] 

What's the matter with you people this 
morning? [Laughter] Is this thing so 
plainly gotten up that no questions are nec- 
essary? Go ahead back there? 

[37.] Q. Mr. President, on M18 (p. 

54) — 

Q. Mr. President 

THE PRESIDENT. Just a miuute. What's 
the page now? 

Q. Ml 8 — on the Public Debt — do you 
have any idea how high you can go with 
safety on that? 

THE PRESIDENT. There are a lot of guesses 
on that, as high as 278 — ^280, the Secretary 
of the Treasury says. 

Secretary Snyder: I have been trying my 
best to get to the point where we can pay 
some of that debt off. 

THE PRESIDENT. We did pay $26 billion 
on it, if you remember, but a certain Con- 
gress came along and raised Cain with it 

Q. Which one was that? 

THE PRESIDENT. but we are going to 

make it, some day. 

Q. Mr. President, regarding the public 
debt, what do you regard as a danger point? 

THE PRESIDENT. I havc no Statement to 
make on the subject. I remember when I 
was in the Senate of the United States I 
heard distinguished Senators get up and say 



41 



[8] Jan. 7 



Public Papers of the Presidents 



that whenever the national debt had reached 
$110 billion the country would go bankrupt 
and we would all go to hell — and we didn't. 
And I don't think we will now, either, under 
present conditions. 

[38.] Q. Mr. President, if you get those 
additional 3,000 Treasury agents, would you 
be able to collect that additional billion or 
billion and a half in 1951, or would it take 
longer? 

Q. Louder! 

Secretary Snyder: Will you repeat that 
question, so that they can hear it? 

Q. Whether you — ^if you get the addi- 
tional 3,000 Treasury agents, would you be 
able to collect the additional billion to a bil- 
lion and a half in taxes in fiscal 195 1 ? 

Q. We still can't hear. [Laughterl 

Secretary Snyder: He asked the question 
that if we got the additional 3,000 men in 
the Internal Revenue, would we be able to 
collect an additional billion dollars in fiscal 
1 95 1. I will have to point out that as we 
progressed beyond the war period, when we 
had the excise tax situation, and a lot of 
black marketing, that the enforcement peo- 
ple had a luxury field in which to collect 
additional revenue. We will have to put on 
additional people and work harder now to 
contact more people to collect less money. 
It is going to be a difficult proposition to col- 
lect as much undeclared revenue — ^yes — 
undeclared revenue — ^now, with more people, 
than it was with fewer people a year or two 
ago. 

We are going to — we have put on a net 
of 4,100 people within the past 6 or 8 months, 
and with these additional people made avail- 
able to us through appropriations we are 
going to put on a very strenuous campaign. 
We cannot estimate exactly what the addi- 
tional revenue would be with those people, 
because of the changing conditions, but we 
know that it will net out a great deal more 
than if we did not have those people. 



Q. Mr. Secretary, how much do you esti- 
mate the costs on collecting each year, in 
revenue? 

Secretary Snyder: We have no way of esti- 
mating that. 

[39.] Q. Mr. President, on page M9 
(p. 47), you say "we can and should make 
now some of the changes which are needed 
in our tax laws, and bring nearer the time 
when the budget can be balanced." I be- 
lieve there are also similar phrases in the 
Economic Report? 

THE PRESIDENT. Yes, we go iuto detail on 
that in that message I am promising you.^ 

[40.] Q. I was going to ask you about 
taxes. I was going to ask if you have a goal 
when you hope the budget will be in 
balance? 

THE PRESIDENT. I waut it balanced as soon 
as possible, and I can't set a date on it, as I 
said awhile ago. Of course I am as anxious 
to have it balanced as anybody in the country. 

[41.] Q. Mr. President, on page M82 (p. 
102) — ^that civil rights program: "In addi- 
tion to the amount provided for establishing 
a Fair Employment Practice Commission, 
there is included f8oo,ooo as the amount 
needed under proposed legislation to estab- 
lish a permanent Commission on Civil 
Rights." I thought they had abolished that 
Fair Employment Commission? 

THE PRESIDENT. It has been abolished, but I 
am asking them to reinstate it. I am asking 
for it to be set up again in the civil rights 
legislation. 

Q. It says "proposed." Has it already 
been proposed? I don't remember it. 

THE PRESIDENT. Yes, it has been proposed. 

Q. By you? 

THE PRESIDENT. Yes. I think if you will 
read my message on civil rights you will find 
it's in there.'^ 

Q. It may be so, there are a lot of things 



"Item 18. 

^See 1948 volume, this series, Item 20. 



42 



Harry S. Truman, igp 



Jan. 7 [8] 



in that message. [Laughter] 

[42.] Q. Mr. President, on page M51 
(p. 79)-RFC 

THE PRESIDENT. M51? 

Q. on the bottom of the second para- 
graph, "I am recommending an additional 
$500 million in. public debt authorizations 
in fiscal year 1950, and $250 million in 1951." 
What is that, a direct entrance into the pub- 
lic debt of that borrowing — in other words, 
increasing the public debt directly in the 2 
fiscal years of 750 million? 

Secretary Snyder: It is a method of financ- 
ing those programs. 

THE PRESIDENT. The Secretary of the 
Treasury says that is a method of financing 
those programs. 

Q. What I am getting at, sir, is how do 
you translate public debt authorizations? 

Secretary Snyder: That would be the sale 
of Government obligations to the public. 

Q. In other words, a direct entrance into 
the public debt? 

Secretary Snyder: That's right. 

[43.] Q. Mr. President, page M27 (p. 
61) — in the National Defense section — ref- 
erence to a reduction in new obligational 
authority. Are the details of that available 
inhere? 

THE PRESIDENT. You wiU find thcm — set 
out specifically in table 8 that has to do with 
that part of the budget. 

[44.] Q. Mr. President, why, in your 
Military, were not the atomic energy and 
stockpiling included in it as the military 

THE PRESIDENT. Because I don't think they 
properly should be included in that. We 
have a special setup for the atomic energy 
proposition, and the stockpiling is for the 
general welfare of the whole Government. 
Stockpiling is included, but I don't think it 
is necessary that it should be. 

Mr. Pace: Stockpiling is in the military. 

[45.] Q. Is there a budget item, Mr. 
President, to cover universal training? 



THE PRESIDENT. No. 

Q. Why not? You recommended it. 

THE PRESIDENT. I Still rccommcud it, and 
I am still for it. I have been recommending 
it ever since October 1945.^ 

Q. How much would it cost if you got it? 

THE PRESIDENT. I estimate it as $800 
million. 

Q. If you got it, would it increase the 
deficit that much? 

THE PRESIDENT. YeS. 

[46.] Q. Is there an item in here any- 
where — I can't find it — for going forward 
with that radar net development? 

Secretary Snyder: Yes. That is in the 
Treasury appropriation — Coast Guard. 

THE PRESIDENT. Coast Guard, under the 
Treasury, so the Secretary tells me. 

Mr. Pace: It is included, the radar fence, 
in the Department of the Air Force. It is 
included in here as well as the one men- 
tioned by the Secretary of the Treasury. 

Q. How much is that item? 

THE PRESIDENT. I cau't auswer offhand. 
The Budget will have to hunt it up. 

[47.] Q. Page M44 (p. 74) — social secu- 
rity — ^social welfare, health and security — 
proposed legislation under the Federal Secu- 
rity Agency — under promotion of public 
health — ^if I remember correctly, last year 
you listed a tentative figure of 800 million 
for a proposed health program. I notice 
that is not there this year. Do you concede 
that there is no possibility of enacting that 
program? ^ 

THE PRESIDENT. No, I don't coucede it, and 
I am going to fight for it as long as I am 
President. And I am going to get it, one of 
these days. 

Q. This year? 

THE PRESIDENT. In 1 947, the Budget Di- 
rector says. 

®See 1945 volume, this series, Item 174. 
'See 1945 volume, Item 192, and 1949 volume, 
Item 85, this series. 



43 



[8] Jan. 7 



Public Papers of the Presidents 



Mr. Pace: If you look, you will see it. 

[48.] Q. You mention the subject of 
taxes in three messages 

THE PRESIDENT. I beg youf pardon? 

Q. You mention the subject of taxes in 
three messages, but I don't recall your saying 
anything about an increase in taxes. Did 
you say anything about taxes being 

THE PRESIDENT. I am goiug to tcll you all 
about it when we get this tax message ready. 
It will be ready in a few days. 

Q. You say in a few days, sir? 

THE PRESIDENT. Yes — ^few days. It won't 
be ready Monday. That is only 2 days off. 

Well, gendemen, I appreciate your interest 
in this, and I want to say to you that the 
Budget Bureau and the Treasury will be 
available to answer any further questions 
that you may have to ask. We are glad 
to do it — glad to give you all the information 
possible in connection with this tremendous 



pile of figures. We have tried to make it as 
plain and to set it out in as simple language 
as possible. I think myself that it is the 
best budget statement that has been gotten 
out since I have been President. Thank you 
very much. 

Voices: Thank you. 

THE PRESIDENT. Oh, the Budget Director 
wants me to call your attention to page Mi 3 
(p. 51), the Management Improvement Pro- 
gram. I hope you will read that very care- 
fully. That is the first time it has been in 
the budget. 

Reporter: Thank you, Mr. President. 

note: President Truman's two hundred and eleventh 
news conference was held in the Movie Projection 
Room in the East Wing of the White House at 10: 05 
a.m. on Saturday, January 7, 1950. The President 
was assisted in presenting information on the budget 
by John W. Snyder, Secretary of the Treasury, by 
Frank Pace, Jr., Director of the Bureau of the Budget, 
and by Frederick J. Lawton, Assistant Director of 
the Bureau of the Budget. 



Annual Budget Message to the Congress: Fiscal Year 195 1. 
January 9, 1950 

[ Released January 9, 1950. Dated January 3, 1950 ] 



To the Congress of the United States: 

I am transmitting my recommendations 
for the Budget of the United States for the 
fiscal year ending June 30, 195 1. 

This Budget is a statement of the financial 
program for the United States Government, 
under both existing laws and new legisla- 
tion which I am recommending to the Con- 
gress. It is an expression, in financial terms, 
of the actions this Government can and 
should take at this time to build toward eco- 
nomic growth and the expansion of human 
freedom, in our own country and in the 
world. 

For the fiscal year 1951, Budget expendi- 
tures under this financial program are esti- 
mated at 42.4 billion dollars, about 860 mil- 
lion dollars below estimated expenditures for 



the current year. Budget receipts under 
existing tax laws are estimated to be 37.3 
billion dollars, a decrease of about 460 mil- 
lion dollars below the present year. The 
estimated Budget deficit for the fiscal year 
1 95 1 is thus 5.1 billion dollars under present 
tax laws, compared with an anticipated 
deficit of 5.5 billion dollars in the fiscal year 
1950. 

I shall shordy recommend to the Congress 
certain adjustments in our tax laws which 
will produce some net additional revenue in 
195 1, not reflected in this Budget. These 
adjustments will result in a larger revenue 
increase in subsequent years. 

A reduction, greater than that in expendi- 
tures, has been made in the requests for new 
appropriations and other obligational au- 



44 



Harry S. Truman, ig^o 

Budget Totals 
[ Fiscal years. In millions ] 

1949 
actual 

Receipts $38, 246 

Expenditures 40, 057 

Deficit —I, 811 

Note. — ^Estimated receipts exclude new tax proposals. 



Jan. 9 [9] 



1950 

estimated 

$37,763 

43, 297 


1951 

estimated 

$37, 306 

42, 439 


-5,534 


—5, 133 



thority in 1951. Expenditures occur when 
the Government pays its obligations, and the 
Congress grants authority to incur obliga- 
tions when it enacts appropriations, contract 
authorizations, and authorizations to borrow 
from the Treasury. The authority to incur 
new obligations which I am recommending 
for the fiscal year 1951 totals 40.5 billion dol- 
lars, considerably below the 1950 level. This 
fact is significant as an indication that the 
downward trend in expenditures from 1950 
to 195 1 may be expected to continue. 

This financial program provides a sound 
basis on which to proceed. It will properly 
support the extraordinary responsibilities of 
the Federal Government, both at home and 
abroad, and at the same time meet our obliga- 
tion to pursue a policy of financial prudence 
and restraint. Such a policy must be di- 
rected at producing a surplus as soon as pos- 
sible under favorable economic conditions. 
The reductions in expenditures, which I rec- 
ommend, can be achieved and still permit 
our Government to carry on its necessary 
operations effectively. The moderate in- 
crease in revenue, which I shall recommend 
in conjunction with specific tax reforms, can 
be achieved without impairing continued 
economic progress. 

In preparing this Budget, I have carefully 
evaluated the possible alternatives in the 
light of the realities of our present situation. 
The soundness of a fiscal program cannot 
properly be judged simply by the year-to-year 
change in the expected margin between re- 

Lew. -a: 



ceipts and expenditures. A prudent pro- 
gram must meet much broader tests, if it is 
to serve the long-range interests of our 
people. 

The soundness of a fiscal program must 
first of all be judged by whether it allows 
the people, through their Government, to 
meet the demands which the foreign and 
domestic situations put upon them. The 
necessary functions of the Government in 
our complex society are varied and wide- 
spread. They require large expenditures 
but they are vital to our security, to the pro- 
tection of our liberties, to continued social 
and economic progress, and to the welfare 
of our people. I have reviewed the expendi- 
ture programs in the Budget, one by one, 
and found them necessary to achieve these 
purposes. I am confident that the Congress 
w^ill come to essentially the same conclusion. 

The soundness of the Government's fiscal 
program must also be judged by its impact 
on the economy. The Federal Budget is a 
substantial part of the total flow of incomes 
and expenditures in our country each year. 
Federal receipts and expenditures must both 
be planned to encourage the prosperity of 
the economy and keep it healthy and grow- 
ing. Irresponsible and short-sighted budg- 
etary action could contribute to a worsening 
of the world situation and to a decline in 
production and employment in the United 
States. Under either of these circumstances, 
we would find ourselves faced by the neces- 
sity of Budget oudays much larger than 



45 



[p] Jan. 9 



Public Papers of the Presidents 



those I am proposing, while the prospect for 
increased revenues would be much less 
encouraging. I am convinced that the rec- 
ommendations I am making, both for ex- 
penditures and for revenues, will contribute 
to continued economic development. 

The soundness of a fiscal program must 
be judged, finally, in the light of where that 
program will take us over a period of years. 
This is partly a matter of necessity: most 
Government programs are based on a time 
schedule extending over a number of years, 
and a large part of the Budget in any one 
year represents binding commitments to 
spend established in previous years on the 
one hand, and tax liabilities already incurred 
on the other. It is primarily a matter of 
wisdom: sharp and arbitrary changes in Gov- 
ernment programs, even where feasible, in- 
volve economic loss and dislocations, and 
may cause serious damage to parts of the 
economy. I am confident that the fiscal 
recommendations provide a solid basis for 
moving toward budgetary balance in the 
next few years. My confidence is based on 
three main considerations. 

First, it has been possible to reduce antici- 
pated expenditures for the fiscal year 1951 
by close to i billion dollars below the esti- 
mated level for 1950, and an even greater 
reduction has been made in the request for 
new obligational authority. Thus, the poli- 
cies followed in preparing this Budget will 
permit further reductions in subsequent 
years. Specifically, the largest item in the 
Budget, national defense expenditures, is ex- 
pected to approximate the 1951 level in the 
next few years; and the costs of our foreign 
aid and veterans' programs should continue 
the decline already expected between 1950 
and 1 95 1. It should also be possible in 
future years to reduce the cost of programs 
which have helped to meet the postwar 
transition problems of specific major areas 
of our economy, notably the support of agri- 



cultural prices and the creation of an ade- 
quate secondary market for housing mort- 
gages. Finally, if the Congress enacts the 
proposed increase in postal rates, the burden 
of the postal deficit on recent Budgets will 
be largely eliminated. 

The programs mentioned above constitute 
the bulk of the Federal Budget. With re- 
spect to other programs, relating primarily 
to domestic activities. Federal responsibilities 
will increase as the Nation grows. But the 
additional budgetary requirements for these 
programs, under a prudent fiscal policy, 
should be substantially less than the decline 
to be expected in the extraordinary postwar 
programs. In this connection it should be 
emphasized that the urgently needed insur- 
ance measures which are recommended in 
the fields of unemployment compensation, 
old-age security, and medical care will be 
primarily financed by special taxes designed 
to defray their costs. 

Thus, assuming continued favorable eco- 
nomic and international developments, it is 
possible to plan on further reductions in total 
expenditures after 195 1. 

The second major consideration support- 
ing my confidence in this fiscal program is 
the fact that our economy is a dynamic and 
growing one. Each year our population and 
the productivity of our labor force rise, and 
our total national output must rise also if 
we are to fulfill our obligation to maintain 
high employment. As our economy grows, 
tax revenues will grow also. The effects of 
this growth are not fully reflected in the 
receipts estimates for 195 1, because the tem- 
porary decline in incomes during this past 
year will affect some tax yields in 1951. 

Federal expenditures are themselves of 
fundamental importance to our prospects for 
steady economic growth. Programs for such 
purposes as national defense and interna- 
tional recovery are essential to maintain a 
favorable international situation. In addi- 



46 



Harry S. Truman, ig^o 



Jan. 9 [9] 



tion, many Federal expenditures constitute 
direct supports for important sectors of our 
economy, or direct investments in assets such 
as power facilities or in better education and 
other services, which add to the productive 
capacity of the Nation. Thus this Budget 
is not only consistent with an expanding 
economy, but will make a substantial con- 
tribution to that objective. 

In analyzing the economic impact of Fed- 
eral financial operations on our economy, 
increasing attention is also being paid to the 
aggregate of Federal cash transactions with 
the public, which are not fully reflected in 
the totals of Budget expenditures and re- 
ceipts. Primarily important is the fact that, 
as long as the social insurance trust funds 
are building reserves to cover liabilities in 
future years, they show a substantial excess 
of receipts over payments. Therefore, the 
current economic impact of Federal financial 
activities, as reflected in the net difference 
between all cash receipts from and all cash 
payments to the public, is usually different 
from that indicated by the Budget surplus 
or deficit. In 195 1, for example, the excess 
of cash payments over receipts is estimated 
at 2.7 billion dollars, 2.4 billion dollars less 
than the estimated Budget deficit. Continu- 
ing improvement in our fiscal position, 
which our present plans should achieve, will 
therefore probably result in an excess of total 
cash income over cash outgo before the 
Budget will show a surplus. This aspect of 
our over-all fiscal position is important in 
supporting the basic economic soundness of 
the fiscal program, although it does not 
lessen the need for the greatest possible pru- 
dence in the conduct of our financial opera- 
tions as reflected in the Budget, which is the 
proper instrument of Executive and Legis- 
lative control. 

The third major consideration supporting 
the soundness of this fiscal program is the 
fact that the tax recommendations which I 



shall transmit to the Congress will both im- 
prove our tax structure and place us in a 
better position to meet our continuing fiscal 
requirements. It is highly important that 
we begin to make the basic changes in the 
tax system which are needed to make it 
more equitable and to provide better incen- 
tives for producing the amounts and types of 
investment, consumption, and savings which 
will contribute to an expanding economy. 
The large and badly devised tax reduction of 
1948 sharply limits the extent to which we 
can make changes at the present time. Nev- 
ertheless, we can and should make now some 
of the changes which are needed in our tax 
laws, and bring nearer the time when the 
Budget can be balanced. Because of the 
time lag in tax collections after changes in 
the law, and the fact that some of the changes 
will result in an immediate loss in revenue, 
the tax recommendations which I shall sub- 
mit to the Congress will produce less addi- 
tional revenue in 1951 than in subsequent 
years, when the changes will be fully 
effective. 

For all these reasons, the financial program 
which I am recommending represents a 
sound, long-range basis on which to plan our 
governmental operations at this time. It is 
directed at achieving a budgetary balance 
in the only way in which it can be achieved — 
by measures which support rather than im- 
pair the continued growth of our country. 
It is based on expenditure plans which can 
be sustained in the years following 1951 
without embarrassment to our fiscal position. 
Its accomplishment does, however, depend 
upon our continued self-control in holding 
expenditure programs to no more than nec- 
essary levels. 

As in all recent years, the Budget for 1951 
is dominated by financial requirements to 
pay the costs of past wars and to achieve a 
peaceful world. Estimated expenditures for 
these purposes are 30 billion dollars, or about 



47 



[9] Jan. 9 



Public Papers of the Presidents 



71 percent of the total Budget. This is a 
reduction of 1.8 billion dollars from esti- 
mated expenditures for the same purposes in 
1950. National defense and international 
programs, designed to insure our security 
and to create the economic and political con- 
ditions necessary for world peace, will re- 
quire about 18 billion dollars. Veterans* 
programs and interest on the public debt, 
commitments arising mainly from the last 
war, will require about 12 billion dollars. 

Our unprecedentedly large expenditures 
in recent years for international programs 
have been undertaken to assist free peoples 
to recover from the devastation of the war 
and to restore their capacity for future 
growth both in material things and in the 
practice of democratic principles. These 
programs are proving to be an investment 
paying dividends, far beyond their cost, in 
enhancing our own security and in providing 
a basis for world peace and prosperity. The 
job is not yet done, the goals are not yet 
reached; but the progress so far achieved 
makes possible in 1951 a substantial reduc- 
tion in the dollar costs of these programs. 
Total expenditures for international affairs 
and finance are estimated at 4.7 billion dol- 
lars, a reduction of 1.3 billion dollars from 
1950. This amount reflects the minimum 
requirements for these programs, and their 
success to date emphasizes the compelling 
need to carry them through on the planned 
basis. 

As progress is made toward achieving the 
short-range objectives of recovery and relief, 
two other international activities assume in- 
creasing importance. First, I am renewing 
the recommendation for a program of tech- 
nical and capital assistance to underdevel- 
oped countries. The Budget expenditures 
in 195 1 will be relatively small but they rep- 
resent a step of great significance in the 
encouragement of world economic expansion 
and the growth of world trade, which are 



essential to our national prosperity. Second, 
I am recommending additional funds in 
1 95 1 for the mutual defense assistance pro- 
gram, authorized by the Congress last year, 
and now getting under way. This program 
is a necessary supplement to economic 
growth as a bulwark against aggression, and 
is an integral part of the cooperative effort 
to assure the continued independence of free 
nations. 

Expenditures for national defense must be 
sufficient to provide us with the balanced 
military strength we must maintain in the 
present world situation, at a level which can 
be sustained over a period of years. In 
195 1, expenditures for national defense are 
estimated at 13.5 billion dollars, an increase 
of about 400 million dollars over 1950. The 
present level of expenditures is substantially 
less than was anticipated a year ago, and is 
the result of careful Budget planning and 
vigorous administrative action. 

Expenditures for veterans' services and 
benefits are estimated at 6.1 billion dollars 
in 195 1, a decline of 825 million dollars from 
1950. Our veterans' programs represent 
commitments which the Government has 
made to those who have served in its 
armed forces, and these commitments must 
be met. While that part which represents 
pensions, medical care, and similar services 
will continue to rise gradually, the program 
of readjustment benefits was intended to be 
transitional, and we should plan on a con- 
tinued reduction in its cost during the next 
few years. 

Interest on the public debt is estimated at 
5.6 billion dollars in 195 1, slightly lower 
than in 1950. This is, of course, a fixed 
commitment of the Government, and repre- 
sents predominantly the cost of financing the 
last war. 

All expenditures, other than those for in- 
ternational, national defense, and veterans' 
programs, and interest on the debt, total 



48 



Harry S. Truman, ig^o 



Jan. 9 [9] 



12.5 billion dollars, about 29 percent of the 
total Budget. This is an increase of about 
I billion dollars from estimated expenditures 
for these purposes in 1950. They include 
many important activities such as the Atomic 
Energy Commission and the Maritime Com- 
mission, which are closely related to our 
national security. Furthermore, they repre- 
sent those positive functions which Govern- 
ment must fulfill if we are to have a healthy 
and growing economy. Federal expendi- 
tures for these purposes in 195 1 are expected 
to constitute a substantially lower percentage 
of the total national income than the corre- 
sponding percentage in 1939. 

The 12.5 billion dollars which this Budget 
provides for these domestic programs, 
viewed item by item, reflects — and has been 
generally recognized by the Congress to re- 
flect — the necessary contributions of the Fed- 
eral Government in our modern economy. 
The major question in my mind is not 
whether we are doing too much, but whether 
the budgetary requirements of the major 
national security and war-connected pro- 
grams have constrained us to undertake too 
little toward supporting and stimulating the 
realization of our country's great potential 
development. It must be recognized that 
failure to support essential Federal activities 
would impede the continued expansion upon 
which the well-being of our economy and the 
soundness of the Government's fiscal posi- 
tion alike depend. 

Expenditures in this Budget, designed to 
assist economic development in the categories 
of housing and community development, 
agriculture, natural resources, transportation 
and communication, finance, commerce, and 
industry, and labor, together amount to 7.9 
billion dollars, 19 percent of total estimated 
expenditures. 

We must push ahead, for example, with 
atomic energy development, and the Budget 



provides 817 million dollars for this purpose. 
We must maintain and develop adequate 
aviation facilities and services, for which 230 
million dollars is included. The Federal 
Government should continue to assist States 
in developing an adequate national highway 
system; Federal expenditures for this pur- 
pose are estimated at 507 million dollars in 
1 95 1. The development of our rivers for 
flood control, navigation, reclamation, 
power, and other uses is of fundamental 
importance for economic growth, and is 
largely a Federal responsibility, for which 
this Budget includes 1.4 billion dollars. The 
Government is substantially aiding private 
industry and local communities in producing 
more and better housing at prices people 
can afford; 1.3 billion dollars is included for 
these purposes. Over 800 million dollars is 
provided to further the conservation of farm 
lands and to make loans for extending elec- 
tricity to farms. 

There is one aspect of these expenditures 
which has properly received widespread at- 
tention by the Congress and the public as 
having an important bearing on the long-run 
fiscal position of the Government. Many 
expenditures represent the acquisition of as- 
sets which are recoverable or will give con- 
tinuing returns in future years, and which 
in normal business accounting would not 
usually be considered as current expense. It 
is estimated that in the 1951 Budget such 
expenditures, excluding military public 
works and equipment, amount to about 5.6 
billion dollars, of which about 4 billion dol- 
lars is anticipated to be in the recoverable 
category. In the case of the Federal Govern- 
ment, in contrast to private business, these 
investment expenditures cannot properly be 
financed differendy from other items in the 
Budget. But their size and nature are im- 
portant in evaluating the strength of our 
fiscal position. A special analysis of the 



49 



[9] Jan. 9 



Public Papers of the Presidents 



nature and extent of investment expendi- 
tures is included in part III of the Budget 
this year for the first time. 

Economic growth must be matched by 
comparable development in the social w^ell- 
being and living standards of all our people. 
Continued progress depends in large part 
upon the increasing fulfillment of the respon- 
sibilities of Government in such fields as 
social welfare, education, and public health. 
In addition to the transfer of 594 million dol- 
lars of pay-roll taxes to the railroad retire- 
ment trust fund, the Budget proposes total 
funds of 2.1 billion dollars for social welfare, 
health, and security, and 434 million dollars 
for education and general research, about 
one-sixteenth of total Federal expenditures. 
These, too, are investments in the future of 
our country. Over 80 percent of these funds 
is for grants to States and localities. 

The remaining programs, classified under 
general government, are estimated to cost 1.3 
billion dollars. These funds provide for 
over-all legislative, judicial, and executive 
operations of the Government, and for vari- 
ous central services such as the maintenance 
of public buildings. Included in this total 
are 424 million dollars for tax collection and 
other financial operations, and 333 million 
dollars for the Government's payment to the 
civil service retirement fund. 

The detailed activities of Government 
agencies in all fields have been closely re- 
viewed to eliminate all but the minimum 
operations required. This has made neces- 
sary the denial of request after request for 
additional funds which — ^taken by them- 
selves and in the judgment of particular 
groups affected — are highly meritorious. 
The progress made in this Budget in revers- 
ing the trend toward higher expenditures 
and in achieving a substantial reduction has 
been made possible only by the most vigorous 



application, in every area, of a policy of hold- 
ing the numerous activities to essential levels. 

In a very few cases — ^mainly middle-in- 
come housing — ^the exigencies of particular 
situations justify the recommendation of lim- 
ited new domestic programs. In addition, 
I am renewing proposals previously made 
for aid to education and expanded public 
assistance, primarily in the form of grants 
to States, and for the enactment of certain 
social insurance legislation which would be 
financed primarily by special taxes. Beyond 
this, however, I am recommending no new 
programs which would require large expend- 
itures in future years, above the amounts 
included in this Budget. In the case of ex- 
isting programs, while vigorous effort is be- 
ing devoted to improving their efficiency, 
they must in the public interest be given 
sufficient funds to allow effective operation. 

The rise from 2.5 billion dollars in 1950 
to 3.1 billion dollars in 1951 in estimated 
civil public works expenditures, including 
grants and loans, reflects almost entirely the 
minimum requirements of projects and pro- 
grams now under way. With respect to Fed- 
eral public works in such fields as reclama- 
tion, flood control, and rivers and harbors, 
this Budget does not provide for starting any 
new projects, despite the pressures that exist 
for initiating construction of a large number 
of additional projects which are already au- 
thorized. Federal grants to States for public 
works have also been generally limited to the 
necessary costs required to carry forward 
continuing construction programs, primarily 
those for highways, airports, and hospitals. 

Our policies with respect to expenditures 
must of course remain flexible to meet shifts 
in international or economic conditions. 
The policies I have outlined represent the 
sound and necessary basis for Budget pro- 
grams in the light of the oudook at this time. 



50 



Harry S. Truman, 7950 



Jan. 9 [9] 



MANAGEMENT IMPROVEMENT 
PROGRAM 

The past year has been one of outstand- 
ing achievement in improving the organiza- 
tion and operating methods of the executive 
branch. This is an important fact to note 
in the Budget Message as the accomplish- 
ment of better management in Government 
is essential to the fulfillment of our estab- 
lished fiscal goals. It is also a responsibility 
to which every official must give increased 
attention if the public is to receive a full 
return on its tax dollar. Action has been 
taken on many fronts. To cite but a few: 
the Department of State has been reorga- 
nized; improved operating methods have 
been installed in the Treasury Department; 
further progress toward unification has been 
made with the creation of a Department of 
Defense; central service functions of the 
Government have been reorganized in the 
General Services Administration; significant 
reorganizations have occurred in the Post 
Office Department, the Department of Com- 
merce, and the Civil Service Commission. 

In cooperation with the Congress, I intend 
to continue a vigorous program to achieve 
further improvements in governmental 
management. 

One phase of this program requires the 
enactment of legislation and the approval of 
reorganization plans. During the coming 
year I recommend that the Congress enact 
basic personnel legislation to make possible 
further improvements in the way the Gov- 
ernment recruits, trains, and supervises its 
employees. I also recommend that the Con- 
gress take action to allow the Post Office to 
maintain its own accounts and conduct its 
financial affairs on a businesslike basis and 
to permit appointment of postmasters by the 
Postmaster General. 



During the session I shall transmit to the 
Congress a number of reorganization plans. 
The objective of these plans will be the es- 
tablishment of clear lines of responsibility 
and authority for the management of Gov- 
ernment activities and the more effective 
grouping of Government programs within 
departments and agencies. 

A second phase of the management im- 
provement program includes Government- 
wide activities in which all agencies partici- 
pate. Major undertakings in this area are 
the installation of more efficient property and 
records management practices under the 
leadership of the General Services Adminis- 
tration; strengthening of personnel manage- 
ment activities under the leadership of the 
Civil Service Commission; and institution, 
under the sponsorship of the Bureau of the 
Budget, of systematic review by all agencies 
of operating effectiveness and economy as 
required by the Classification Act of 1949. 
In addition, more modern accounting prac- 
tices are being installed throughout the Gov- 
ernment under the guidance of a joint com- 
mittee consisting of the Secretary of the 
Treasury, the Comptroller General and the 
Director of the Budget. 

In the field of programing and budgeting, 
the progress made toward presentation of 
this 195 1 Budget on a "performance" basis 
is an example of results stemming from the 
improvement program. An examination of 
the body of this document will indicate a 
substantial change from that of previous 
years. The activities for which funds are 
recommended are described so that the Con- 
gress and the citizens may see more clearly 
the relationship between the activities to be 
performed and the costs of those activities. 
Future Budget documents will include addi- 
tional improvements. Some of these will 
reflect current efforts both to strengthen and 



[p] Jan. 9 



Public Papers of the Presidents 



simplify Government accounting and to de- 
velop better measures of work performance. 
Others will provide additional kinds of anal- 
yses to enable examination and understand- 
ing of the Budget from different standpoints. 

The third aspect of the management im- 
provement program is the work being done 
by individual departments and agencies. I 
have instructed each department and agency 
head to inaugurate an aggressive program 
of management improvement in his depart- 
ment. These departmental programs have 
been reviewed in terms of their relation to 
financial requirements and their contribution 
to the solution of known problems. I will 
announce shortly certain areas to which 
priority will be given in the management 
improvement work of the executive branch 
during the year 1950. The special fund for 
management improvement which was au- 
thorized by the Congress last year will be 
utilized to carry out some of the specific 
projects. In following through to secure 
results from this entire program I will have 
the assistance and advice of my Advisory 
Committee on Management Improvement. 

Under our Federal form of government, 
many public services are the common con- 
cern of Federal, State, and local government. 
Continuing attention needs to be given by 
all levels of government to the problems 
arising from the interrelations of our tax 
systems and the administration of common 
governmental functions. Federal and State 
and local officials are currendy studying the 
possibilities of further cooperative arrange- 
ments in tax administration in order to re- 
duce costs and improve coordination. We 
are also cooperating in developing legislative 
proposals to deal with several current prob- 
lems of mutual concern: provision of certain 
local services to Federal personnel, applica- 
tion of local taxes to personnel and transac- 
tions on Federal reservations, and the 
establishment of a general system of pay- 



ments to State and local governments whose 
property-tax base has been reduced by Fed- 
eral acquisitions of real estate. 

The reports of the Commission on Orga- 
nization of the Executive Branch of the 
Government have provided the framework 
for much of the improved organization and 
management which has been achieved and 
which I hope to achieve during the coming 
year. While work has been started in a 
number of the areas containing the greatest 
potential for economy and improved opera- 
tions, many further legislative and adminis- 
trative actions are needed. It should be 
realized that the greater effectiveness and 
economy and better service to the public, 
which come from improved management, 
are the cumulative result of a great many 
individual actions. Realization of those 
goals requires the coordinated and unrelent- 
ing efforts of all Federal officials and em- 
ployees. We must continue to emphasize 
the achievement of better management as 
an important part of the job of public service 
in which the Congress and the executive 
branch are engaged. 

BUDGET RECEIPTS 

Budget receipts in the fiscal year 1951 are 
estimated at 37.3 billion dollars under exist- 
ing tax legislation, 457 million dollars below 
the estimate for the current year. Decreased 
collections from corporation income taxes 
account for the principal decline in receipts 
between the 2 years, reflecting the fact that 
the reduction in corporate profits from the 
calendar year 1948 peak does not have its 
full effect on tax receipts until the fiscal year 
195 1. The estimates of receipts assume eco- 
nomic activity at approximately the same 
level as at the present time. 

I will shortly transmit to the Congress my 
recommendations for changes in our tax laws 
to provide a more balanced and equitable 



52 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Budget Receipts 
[ Fiscal years. In millions ] 



1949 
actual 



Source 
Direct taxes on individuals: 

Individual income taxes $17, 929 

Estate and gift taxes 797 

Direct taxes on corporations: 

Corporation income taxes 11, 343 

Excess profits taxes 211 

Excises 7> 551 

Employment taxes: 
Existing legislation: 

Federal Insurance Contributions Act i» 690 

Federal Unemployment Tax Act 223 

Railroad Retirement Tax Act 564 

Railroad Unemployment Insurance Act 10 

Proposed legislation: 

Medical care insurance 

Improvement of old-age and survivors insurance 

Customs 384 

Miscellaneous receipts: 

Existing legislation 2,072 

Proposed legislation 

Deduct: 

Appropriation to trust funds: 

Existing legislation ~"ii ^9° 

Proposed legislation: 

Medical care insurance 

Improvement of old-age and survivors insurance 

Refunds of receipts — 2, 838 



1950 
estimated 

%i7> 971 
697 

11,075 

100 

7,631 



2,245 

223 

570 

10 



375 



I, 28 



—2, 245 



— 2, 177 



I95I 

estimated 



$18,246 
692 

10,458 

60 

7,642 



2,515 

224 

594 
10 

250 
1,200 

375 

1,096 
60 



—2, 515 

—250 
— 1,200 
—2, 151 



Budget receipts 38, 246 37, 7^3 37, 3o6 

Note. — ^Estimated receipts for 1951 exclude new tax proposals, except for recommended changes in em- 
ployment taxes and miscellaneous receipts. 



tax structure and to increase Federal reve- 
nues. The net increase in revenues during 
1 95 1 will be substantially smaller than in 
subsequent years, owing to the time required 
for some of the changes to become fully 
effective. 

Direct taxes on individuals, — Receipts 
from the income tax on individuals exceed 
those from any other tax. The total of 18.9 
billion dollars estimated for 1951 for direct 
taxes on individuals is practically unchanged 
from the 1950 total, and reflects continued 
high levels of employment and income. 

Direct taxes on corporations, — ^The fiscal 
year 1951 estimate of receipts from taxes on 
corporations is 10.5 billion dollars. During 
the fiscal year 1951 corporations will pay 



income tax on the profits earned during the 
calendar years 1949 and 1950. The decline 
in profits from the peak level of 1948 will 
therefore adversely affect these receipts for 
the fiscal year 1951. 

Excises and customs, — ^Under present laws 
very litde change is anticipated in collections 
of excise taxes and customs. 

Employment taxes.— Tht, tax rate for old- 
age and survivors insurance was increased 
from I to 1 54 percent on the first of this 
month; hence the receipts estimate for 
1950 includes taxes based upon both the old 
rate and the new. Receipts for 195 1 under 
existing legislation represent a full year's 
collection at the new higher rate. 

I have recommended expansion and im- 



53 



[9] Jan. 9 



Public Papers of the Presidents 



provement of the old-age and survivors in- 
surance system and a nev^ program of 
medical care insurance. It is estimated that 
the additional taxes to be collected for these 
programs will amount to 1.4 billion dollars 
in 1 95 1. Since these sums w^ill be trans- 
ferred immediately to trust accounts, Budget 
receipts will not be increased. 

Miscellaneous receipts, — Miscellaneous re- 
ceipts have been declining steadily since 
1947, primarily because of the drop in sales 
of surplus property originally acquired for 
war purposes. During 195 1 receipts from 
surplus property will be only about o.i bil- 
lion dollars compared to the peak of 2.9 
billion dollars in 1947. 

There are other decreases in the estimates 
of miscellaneous receipts which are in the 
nature of changes in reporting. Certain 
receipts, notably of the Farmers* Home Ad- 
ministration and of the public housing pro- 
gram, were formerly deposited into miscel- 
laneous receipts, but are now deducted from 
the expenditures of the programs involved. 
These changes, of course, have no effect on 
the surplus or deficit. 

The estimate of miscellaneous receipts for 
195 1 reflects my recommendation that legis- 
lation be enacted to permit the acceleration 
of capital repayment by the Federal home 
loan banks. An increase in patent fees is 
also necessary to make the Patent Office more 
nearly self-supporting. 

Refunds of receipts, — Refunds for 195 1 are 
estimated at about the same level as for the 
current year, 0.7 billion dollars less than in 
1949. The decline is the result of the fact 
that 1949 refunds were unusually high be- 
cause of the retroactive features of the Reve- 
nue Act of 1948. 

PUBLIC DEBT 

The public debt amounted to 252.8 billion 
dollars on June 30, 1949. Estimated Budget 



deficits of 5.5 billion dollars in the fiscal year 
1950 and 5.1 billion dollars in the fiscal year 
195 1, together with certain minor adjust- 
ments, will cause the debt to increase to 263.8 
billion dollars by the end of 195 1. In 195 1, 
about 2.5 billion dollars of the increase in 
the debt will be financed by new investments 
in Federal securities by trust accounts and 
other Government agencies. 

BUDGET EXPENDITURES AND 
AUTHORIZATIONS 

A summary of Budget expenditures ac- 
cording to the broad programs or functions 
for which the money is spent is set forth in 
the table below. This table includes all ex- 
penditures from the general and special 
funds of the Treasury and the net expendi- 
tures of wholly owned Government corpora- 
tions. Expenditures from the trust funds 
are excluded. 

All expenditures flow from obligational 
authority enacted by the Congress. The net 
new appropriations and other authorizations 
recommended for the fiscal year 1951 total 
40.5 billion dollars. Of this total, 33.1 billion 
dollars is now formally recommended for 
action by the Congress, while 7.4 billion dol- 
lars is tentatively estimated for later submis- 
sion. In addition, this Budget includes ap- 
propriations of 4.5 billion dollars to liquidate 
obligations incurred under prior year con- 
tract authorizations, more than half in pro- 
grams for the national defense. 

Since contracts with industry must be let 
well ahead of deliveries, a considerable lead 
time is required for the economical operation 
of many Government programs. This is 
especially true for public works and military 
procurement. Financial obligations incurred 
in prior years, therefore, will have already 
fixed a substantial part of the estimated 
Budget expenditures for 1951. Of the total 
Budget expenditures of 42.4 billion dollars 



54 



Harry S. Truman, ig$o 



Jan. 9 [9] 



Budget Expenditures and Authorizations by Major Function 
[ Fiscal years. In millions ] 



1949 

Function actual 

International affairs and finance $6, 462 

National defense 11, 914 

Veterans' services and benefits 6, 669 

Social welfare, health, and security i, 907 

Housing and community development 282 

Education and general research 70 

Agriculture and agricultural resources 2, 512 

Natural resources i» 512 

Transportation and communication i, 622 

Finance, commerce, and industry 120 

Labor 193 

General government i, 170 

Interest on the public debt 5, 352 

Reserve for contingencies 

Adjustment to daily Treasury statement 272 



Expenditures 

1950 
estimated 

$5, 964 

13.148 

6,905 

2,297 

I, 006 

125 

2,671 

1,845 

1,894 

225 

219 

1,223 

5,725 
50 



1951 
estimated 

$4,7" 

13,545 
6, 080 
2,714 
1,329 

434 
2, 206 
2,218 
1,682 

212 

243 
I, 267 
5,625 

175 



"New obligational 
authority for igsi 

Appropria- 
tions 



$4, 505 

'11,359 

5,847 

2, 625 

117 

117 

875 

1,594 

973 

60 

266 

1,231 

5,625 

200 



Other 

$530 

1,441 

165 

704 

7 
580 

370 
673 
250 



Total 49, 057 43, 297 42, 439 '^35, 73i 4, 723 

^In addition 851 million dollars of reserved 1950 contract authorizations and 22 million dollars of 1950 

appropriations will be available for 1951 programs. 

^This Budget also includes 4,514 million dollars of appropriations to liquidate prior year contract 

authorizations. 



estimated for 1951, about 12.1 billion dollars, 
29 percent, will be payments for obligations 
incurred in 1950 or in earlier years; the re- 
mainder will be for 195 1 obligations. 

Net new appropriations recommended for 
1 95 1 are 1.6 billion dollars less than those 
estimated for 1950. They represent total 
appropriations (including permanent appro- 
priations) less those to be used to liquidate 
prior year contract authorizations. New con- 
tract authorizations (which will require later 
appropriations to liquidate) totaling 3.4 bil- 
lion dollars are also included in this Budget, 
also about 1.6 billion dollars less than the 
estimated new contract authority for 1950. 
Special authorizations to use the proceeds of 
Treasury borrowing in the financing of cer- 
tain Government programs are included in 
the 1 95 1 recommendations to the amount 
of 1.4 billion dollars. This represents a de- 



cline of 6 billion dollars from the 1950 esti- 
mate for this type of authorization. The esti- 
mate for 1950, however, anticipates action by 
the Congress in providing supplemental pub- 
lic debt authorizations of 2 billion dollars for 
the Commodity Credit Corporation, one-half 
billion dollars for the Reconstruction Finance 
Corporation, and stand-by borrowing author- 
ity of 1.7 billion dollars for the Federal Sav- 
ings and Loan Insurance Corporation and 
the Federal home loan banks. 

PROGRAMS 

The following sections describe the pro- 
grams undertaken in each of the major func- 
tions of the Government and the new 
proposals I am making in this Budget. In 
addition, this year for the first time the 
Budget contains (in part II) improved pres- 



55 



[9] Jan. 9 



Public Papers of the Presidents 



entations showing in detail the programs and 
performance of all Government agencies. 

International Affairs and Finance 

In 1 95 1, as in every year since the war, 
the cost of our international programs will be 
large because far-reaching problems remain 
to be solved. Notable progress has been 
made toward foreign economic recovery, but 
some of the most difficult steps lie ahead. 
The threat of aggression still exists, requir- 
ing continued efforts to bolster the defenses 
of free nations. The economic underdevel- 
opment of great areas of the world deprives 
their peoples of the adequate living stand- 
ards in which free institutions can flourish, 
and deprives other peoples of needed re- 
sources which expanded world trade could 
bring. 

The 1 95 1 Budget provides for 4.7 billion 
dollars of expenditures on our international 
activities. This is 1.3 billion dollars, or 
more than 20 percent, below estimated ex- 
penditures in 1950. This very substantial 
reduction reflects the declining costs of our 
recovery and relief programs as they have 
stimulated and supported economic recon- 
struction, rising living standards, and grow- 
ing political stability. My recommendations 
for 1 95 1 represent the minimum amount 
required to carry our plans forward toward 
a successful conclusion. The continuing 
and grave uncertainties which remain in the 
world situation make it imperative that we 
be prepared to adjust our efforts to accord 
with developments. If, however, we make 
at this time the investment necessary to 
achieve continued economic recovery, I ex- 
pect the trend in total expenditures for our 
international activities to continue down- 
ward in subsequent years. 

Recovery and relief costs, which in 1951 
will be over 75 percent of international ex- 
penditures, will diminish rapidly as recovery 

56 



programs near completion, although new 
measures may become necessary to attain 
specific objectives in particular areas. At 
the same time, our programs for stimulating 
foreign economic development assume in- 
creasing importance, and expenditures for 
this purpose should increase somewhat in 
future years as political conditions stabilize 
and opportunities for mutually advantageous 
technological improvement and productive 
investment abroad increase. Furthermore, 
expenditures for foreign military assistance 
will remain substantial for several years as 
shipments are made under the programs au- 
thorized in 1950 and proposed for 1951. 

Conduct of foreign affairs, — Expenditures 
in 195 1 for the State Department, through 
which we conduct our foreign affairs, will 
be about the same as for the current year. 
The decline of war claims payments will be 
about offset by increased requirements in 
other programs, notably the Department's 
recent assumption of responsibilities in Ger- 
many. The international information and 
education program will continue at the ex- 
panded level to be reached this year. 

Our Government also participates in many 
international agencies, principally the United 
Nations and its affiliates. Through such 
participation we are actively engaged in a 
cooperative and world-wide effort to build 
the foundations for continued peace and the 
social and economic betterment of all peo- 
ples. One important aspect of this effort 
has been the development of a set of prin- 
ciples and a mechanism, through the pro- 
posed International Trade Organization, for 
facilitating the growth of world trade on a 
multilateral basis. I again urge that the 
Congress approve the charter of the Inter- 
national Trade Organization and pass the 
necessary implementing legislation. 

European recovery program. — A major 
problem of foreign policy today is the fact 
that certain key areas of the world, prin- 



Harry S. Truman, ig^o 

International Affairs and Finance 
[ Fiscal years. In millions ] 



Jan. 9 [9] 



Expenditures 

1949 {950 ipi 

actual estimated estimated 



$134 '$187 '$190 

38 58 49 



"New obligational 
authority for ig^i 
Appropria- 
tions Other 

$175 



4,040 
i»349 

'6 

—41 

73 



8 

288 

—57 
12 



289 
125 
197 



^ 4, 062 
831 

^93 

-38 

70 

5 

15 

23 

71 
II 



160 

195 



3»250 
279 

^iii 

-38 

25 

4 

20 
3 

48 
8 

25 

645 

91 



31 



3, 100 
320 

115 



25 
4 



Program or agency 
Conduct of foreign affairs: 

State Department 

Participation in international organizations (pres- 
ent programs and proposed legislation) 

Other 

International recovery and relief: 
European recovery program and other foreign aid 
(present programs and proposed legislation) . . . 

Aid to occupied areas 

Aid to Korea (present programs and proposed 

legislation) 

Reconstruction Finance Corporation (loan repay- 
ment) 

Aid to refugees: 

International Refugee Organization 

Displaced persons program (present programs 

and proposed legislation) 

Palestine refugees (present programs and pro- 
posed legislation) 

Other 

Foreign economic development: 

Export-Import Bank loans 

Inter- American development 

Technical assistance to underdeveloped areas (pro- 
posed legislation) 

Foreign military assistance: 
Mutual defense assistance program (present pro- 
grams and proposed legislation) 

Greek-Turkish aid (acts of 1947 and 1948) 

Assistance to China (act of 1948) 

Philippine aid 

Total 6, 462 5. 964 4» 711 ^ 4> 505 530 

^ Includes transfer from funds for aid to occupied areas. 
^ Less than one-half million dollars. 

®This Budget also includes 518 million dollars of appropriations to liquidate prior year contract author- 
izations. 



7 
35 

648 
45 



$3o 



500 



cipally western Europe, are faced with the 
necessity of making fundamental and com- 
plex adjustments to the far-reaching changes 
in their trade and financial relationships 
which resulted from the war. The great 
achievement of the European recovery pro- 
gram to date has been to help these countries 
to recover from the devastation of war, to 



restore living standards, and to maintain 
political stability, and thus to place them in 
a position to make the adjustments that are 
required. 

As a consequence of their situation, these 
countries have experienced an extraordinary 
need in recent years for commodities and 
equipment which could, for the most part. 



41-355-^65- 



57 



[g] Jan. 9 



Public Papers of the Presidents 



be supplied only by this country, but for 
which they were not able to pay by the 
export of goods and services. If we had 
permitted their imports to sink to the tem- 
porarily reduced level which they could 
finance, it would have drastically reduced 
their living standards and invited unrest and 
destructive economic nationalism. Instead, 
we have undertaken a planned and mutual 
effort designed to achieve, during a relatively 
short period of United States assistance, ex- 
panded foreign production and trade, an 
increase in exports yielding dollars and a 
lessening need for imports requiring dollars, 
and an increased international flow of in- 
vestment capital, thus establishing the basis 
for economic growth and prosperity. 

The European recovery program has made 
notable progress toward these objectives since 
its inception almost 2 years ago. As a result, 
1 95 1 appropriation requirements for all seg- 
ments of the program, including that portion 
of our aid to western Germany which has 
previously been provided separately from 
funds for aid to occupied areas, will be more 
than I billion dollars below the amounts 
provided by the Congress for the same pur- 
poses in 1950. Serious obstacles, however, 
remain to be surmounted. A substantial 
expansion in international trade and invest- 
ment is necessary if the remaining adjust- 
ments are to be completed without involving 
serious economic and political dislocation. 

The past year has shown that this task 
will not be easy. To achieve an increased 
flow of trade and investment will require 
far-sighted and vigorous steps by the Euro- 
pean countries, and by other nations as well, 
including our own, if international economic 
relationships are to be established on a sound 
basis. The funds included in this Budget 
for continuing our participation in the Euro- 
pean recovery program are an essential ele- 
ment for further progress. 

Other international recovery and relief 



programs, — Our economic aid to occupied 
areas similarly takes the form of recovery 
programs designed to balance their trade at 
levels adequate to maintain stability without 
continued United States assistance. During 
the current fiscal year, responsibility for eco- 
nomic aid to western Germany has been 
transferred from the Department of the 
Army to the Economic Cooperation Admin- 
istration, and these costs will be met in 1951 
from European recovery program funds. 
Army-administered aid to occupied areas in 
1 95 1 will therefore be limited almost wholly 
to Japan and the Ryukyu Islands. The sub- 
stantial sums invested in Japanese recovery 
since the end of the war are yielding results 
which permit a reduction in 1951 outlays 
for this purpose, and bring us nearer to 
termination of this program. 

Although I have urged the Congress to 
authorize a similar recovery program for the 
Republic of Korea, funds provided to date 
permit operation at only a relief level. Early 
enactment of the legislation now pending 
will permit recovery to proceed and hasten 
the date when our aid can be concluded. 
The estimates in this Budget anticipate a 
start toward recovery in the remainder of the 
current fiscal year and substantial further 
progress in 1951. 

Our remaining international requirements 
for purposes of relief, as contrasted with re- 
covery, are chiefly those for assistance to ref- 
ugees. The work of the International 
Refugee Organization will extend through 
195 1 ; its remaining work load, however, is 
substantially reduced, allowing a 65 percent 
reduction in our contribution below the 1950 
level. The estimate for the Displaced Per- 
sons Commission reflects my recommenda- 
tion that the present Displaced Persons Act 
be speedily amended to make it fair and 
workable. The provision for aid to Pales- 
tine refugees is the present estimate of our 
share of the cost of the proposed United 



58 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Nations' program for restoring to productive 
activity the several hundred thousand per- 
sons displaced during the recent conflict in 
Palestine. 

Foreign economic development, — Since 
the end of the w^ar, the urgent, though tem- 
porary, requirements for international re- 
covery and relief have of necessity taken 
priority over longer-range efforts to promote 
w^orld economic development. The devasta- 
tion left by w^ar had to be overcome. The 
restoration of economic strength to the 
world's principal industrial areas necessarily 
had to precede any real economic progress in 
the less-developed parts of the w^orld. 

Now that recovery is well under way, we 
must increasingly turn our attention to meas- 
ures for the gradual and permanent expan- 
sion of world production, trade, and living 
standards which are necessary for enduring 
world peace. Great potentialities for such 
expansion lie in the underdeveloped areas of 
the world, with resulting benefits to the peo- 
ples of these areas and to other countries, 
including our own. 

I again urge the Congress to authorize a 
program of technical assistance to enable the 
peoples of these areas to learn, and to adapt 
to their own needs, modern technological 
and scientific knowledge in such fields as 
agriculture, health, education, transportation, 
and industry. The achievements of our 
present technical assistance activities in the 
American Republics and in Europe attest to 
the success and practicability of this ap- 
proach. This Budget provides for expendi- 
tures of 25 million dollars for the new pro- 
gram. This includes the United States share 
in the cost of the program for technical as- 
sistance recently approved by the United 
Nations. 

A second basic requirement for economic 
progress in underdeveloped areas is a sub- 
stantial increase in the inflow of capital for 
productive investment. These areas should 



offer opportunities for private capital and pri- 
vate enterprise, if there is assurance of fair 
and equitable treatment for foreign capital 
such as is contained in the commercial trea- 
ties which are now being negotiated with 
many nations. Nevertheless, there will re- 
main certain abnormal risks which deter 
potential investors, and I again urge the en- 
actment of legislation authorizing an experi- 
mental program by the Export-Import Bank 
to guarantee private developmental invest- 
ments against such risks. 

In many cases the flow of private capital 
may not be available or adequate, or particu- 
lar circumstances may make governmental 
action preferable. In such cases, the invest- 
ment of public funds may be needed, 
through such institutions as the International 
Bank for Reconstruction and Development 
and the Export-Import Bank. These insti- 
tutions are currendy directing their emphasis 
to loans for developmental purposes. 

Foreign military assistance, — Although 
economic recovery is the most essential con- 
dition to the maintenance of freedom and 
stability in western Europe and other regions 
of vital importance to our own security, eco- 
nomic vitality alone will not suffice to prevent 
aggression. Stronger military defenses are 
required, but these nations cannot unaided 
strengthen their defenses to a point sufl&cient 
to deter aggression without seriously retard- 
ing their recovery efforts. To solve their 
dilemma and to strengthen our own defenses, 
we agreed last year to unite with our neigh- 
bors of the North Adantic community in 
developing and putting into effect an inte- 
grated defense plan for that area. 

We have implemented that decision 
through the Mutual Defense Assistance Act 
of 1949, which provides for the supply of 
arms to the Treaty nations to supplement 
their own defense measures. The act also 
continues our previous program of assistance 
to Greece and Turkey, which has already 



59 



[p] Jan. 9 



Public Papers of the Presidents 



achieved substantial success in ending the 
guerrilla threat to Greek independence and 
in strengthening Turkish defenses. In addi- 
tion the act provides for military aid to cer- 
tain other areas in the Middle and Far East. 

The North Atlantic Treaty nations are 
now^ proceeding with the development of an 
integrated defense plan, the translation of 
that plan into equipment and supply needs, 
and a realistic determination of v^hat each 
participant can do, both for itself and for the 
others, in meeting those requirements. For 
the current year the Congress provided i bil- 
lion dollars for military assistance to the 
Treaty nations, and 359 million dollars for 
the other nations covered by the act. For 
the fiscal year 195 1 1 am recommending new 
obligational authority of i.i billion dollars, 
including 500 million dollars new contract 
authority. 

Except for the previously authorized 
Greek-Turkish program, expenditures in 
1950 will be relatively low, owing to late 
enactment of the new program and the time 
required for agreement on joint plans and 
for the subsequent determination of detailed 
requirements. Expenditures in 1951 for 
foreign military assistance will be almost 
twice as great as in 1950, and may rise some- 
what further thereafter, owing to the long 
delivery time characteristic of military 
procurement. 

Philippine aid, — ^The special concern and 
responsibility we feel for the progress of the 
Philippine Republic have taken the principal 
form, since the war, of assistance in the 
physical rehabilitation of damaged facilities 
and the payment of war damage claims. 
The cost of both of these programs will de- 
cline sharply in 1951 as they approach com- 
pletion. We will continue to follow with 
sympathetic interest the achievements of the 
Philippine people and to assist them in mak- 



ing their contribution to our common 
objectives. 

National Defense 

Our expenditures for national defense 
continue to be the largest item in the Budget. 
Under current world circumstances, in which 
the strength of the United States is making 
such a vital contribution toward world peace, 
we must continue to make the expenditures 
necessary to maintain a position of relative 
military readiness. At the same time, we 
must plan our expenditures for national de- 
fense so that we will achieve our purpose at 
a reasonable cost, well within our capacity 
to sustain over a period of years. 

This Budget represents a further step to- 
ward these objectives. It provides for active 
forces in a high state of training, available 
for immediate use if necessary and as a 
nucleus for rapid expansion in the event of 
an emergency, and for reserve forces, orga- 
nized and trained for early mobilization if 
necessary. This Budget contemplates the 
continued development of planning for in- 
dustrial mobilization and the accumulation 
of a stockpile of strategic and critical ma- 
terials. It continues to emphasize research 
and development to keep our military tech- 
nology abreast of scientific developments, 
and procurement of newly developed weap- 
ons to improve the equipment of the ready 
forces. At the same time this program is 
sufficiently flexible to provide a basis for 
rapid changes should developments in tech- 
nology or international conditions make 
them necessary. 

The recommendations for national defense 
in this Budget take into account the progress 
which has been made and can reasonably be 
anticipated in the programs now being de- 
veloped for the effective integration of our 



60 



Harry S. Truman, ig^o 



Jan. 9 [9] 



defense plans and organizations with those 
of other North Atlantic Treaty nations. 
These defense plans, together with our as- 
sistance in strengthening the forces of these 
countries through the mutual defense assist- 
ance program, should provide an increasing 
measure of security to free peoples on both 
sides of the Atlantic as well as elsewhere in 
the world. 

For the past 2 years we have been adjust- 
ing our military programs to achieve a bal- 
anced structure which can be maintained 
over a period of years without an undue 
use of national resources. The National 
Security Act of 1947 and the amendments 
to that act in 1949 have provided a sound 
organizational framework within which to 
work toward this objective. Vigorous ac- 
tions have been taken to reduce overhead, 
to improve efficiency, to eliminate activities 
of low priority, and to realign our armed 
forces in accordance with a unified strategic 
concept. As a result, the estimate of obliga- 
tional authority for the 195 1 program of the 
Department of Defense, including certain 
obligations in 195 1 from 1950 authority, is 13 
billion dollars, as compared with 14.2 billion 
dollars recommended for 1950 in the Budget 
a year ago. 

My recommendations in this Budget pro- 
vide for balanced land, naval, and air forces. 
In order to avoid the creation of forces in- 
volving commitments over a period of years 
beyond what we could reasonably expect to 
provide, I have had placed in reserve certain 
authorizations for the current year which 
were provided primarily for the expansion 
of the Air Force. These recommendations 
for the Defense Department for 195 1 con- 
template substantially the continuation of 
the revised 1950 program. 

The estimated obligational authority of 
13.7 billion dollars for 195 1 includes 4.0 bil- 



lions for the Army, 3.9 billions for the Navy, 
and 4.4 billions for the Air Force. In addi- 
tion the recommendations include 0.8 billion 
for other Department of Defense activities, 
including retired pay and proposed legisla- 
tion; and 0.6 billion for other national 
defense activities, mainly stockpiling of stra- 
tegic and critical materials. Of this obliga- 
tional authority expected to be required in 
1 95 1, 1 1.4 billion dollars is appropriations 
and 1.4 billion dollars is contract authoriza- 
tions, both requiring action by the Congress. 
In addition, 873 million dollars is to come 
from appropriations and contract authoriza- 
tions which were placed in reserve in 1950 
and are available for 1951 needs. 

The estimated expenditures for national 
defense in 1951 of 13.5 billions, including 
stockpiling and other defense items, are an 
increase of about 400 million dollars from 
estimated expenditures for 1950. The in- 
crease results almost entirely from procure- 
ment and other commitments made under 
authorizations previously approved by the 
Congress. Expenditures in subsequent 
years will reflect the reduction of new obli- 
gational authority for 1951. 

Military strength, — ^Extension of authority 
for selective service, for which I plan to 
submit legislation, is vital as a positive dem- 
onstration of our resolve to maintain the 
strength of the free world. With it we will 
retain our ability to expand our armed forces 
rapidly in an emergency and will also insure 
adequate replacements to maintain the re- 
quired strength of our active forces. 

The extension of selective service author- 
ity will provide a temporary solution to the 
military manpower problem of the active 
forces, but will leave unsolved the problem 
of trained manpower for our reserve forces. 
I point out again the necessity of a program 
of universal training if we are to provide on 



61 



[g] Jan. 9 



Public Papers of the Presidents 



National Defense 
[ Fiscal years. In millions ] 

Expenditures 



New obligational 
authority for igsi 
1949 1950 19s I Appropria- 

actual estimated estimated tions Other 



Program or agency 
Department of Defense, military functions: 

Pay and support of active duty military personnel . . $4, 435 $4, 590 $4, 287 $4, 292 

Operation and maintenance of equipment and fa- 
cilities 3> 41 8 

Civilian components 539 

Research and development 688 

Aircraft procurement i, 230 

Construction of ships 295 

Major procurement other than aircraft and ships. . 198 

Military public virorks 

Industrial mobilization, service-wide administra- 
tion and finance, interservice projects, and Office 
of Secretary of Defense 

Tentative estimate for proposed legislation (in- 
cluding military public works) 

Unexpended reimbursements from mutual defense 

assistance program 

Department of Defense, civil functions: 

Pay of retired military personnel 191 

Other 13 



151 



390 



3,224 
705 
630 

1,656 
314 
455 
299 



487 



—50 



3»294 
740 
606 

2, 081 
298 
678 
182 



491 

70 

-225 



241 
9 



345 

5 



3.406 

757 

^594 

81 

755 



535 
132 

356 



Activities supporting defense: 

Stockpiling of strategic and critical materials 

National Advisory Committee for Aeronautics . . . 

Reconstruction Finance Corporation 

Other 

Tentative estimate for proposed legislation: Selec- 
tive Service System 



299 

49 

-17 

35 



580 

56 

--81 

33 



650 
65 

-48 
22 



400 

48 



Subtotal II, 914 

Deduct 1950 obligational authority deferred to 195 1 



13,148 13,545 ^11,381 



'$1,937 



240 



Subtotal, Department of Defense 11, 548 12, 560 12, 852 ^ 10, 908 ^ 2, 177 



100 
15 



2, 292 
— 22 —851 

Total 11,914 13,148 13,545 * II, 359 i, 44i 

^Includes appropriations of 22 million dollars made for the fiscal year 1950 which will be available for 
obligation in the fiscal year 1951. 

^ Includes contract authorizations of 851 million dollars made for the fiscal year 1950 which will be avail- 
able for obligation in the fiscal year 195 1. 

* This Budget also includes 2,533 million dollars of appropriations to liquidate prior year contract author- 
izations. 



a continuing basis sufficient numbers of men 
for the reserve forces, adequately trained to 
use effectively the increasingly complex ma- 
chines of war. 

The total personnel assigned to combat 
forces will be the greatest since the comple- 



tion of the demobilization following World 
War II, although the amounts recommended 
for 195 1 will provide about 3 percent fewer 
officers and enlisted personnel on full-time 
active duty than at present. In 1951, it is 
planned to continue the organized units of 



62 



Harry S. Truman, ig^o 

Military Pay Strength 
[ In thousands ] 

Regular and reserves on jull-titne 
active duty 

Dec, 31, ig^i 

Mar. 31, ig4g average 

1948 (estimate) (estimate) 

Anny 538 639 630 

Navy and Marine Corps 488 492 461 

Air Force 368 416 416 

Total 1,394 1,547 i»507 



Jan. 9 [9] 



Reserves in drill pay 
status 

1951 

October average 

jg4g (estimate) 

565 605 

213 256 

82 118 



860 



979 



the reserve forces at approximately the 
strength which is expected to be achieved by 
the end of the current year, but with better 
equipment, facilities, and training. 

Under these recommendations for the 
Army, this Budget wdll provide 10 divisions, 
48 antiaircraft battalions, and other combat 
and service units. Complementing the ac- 
tive Army will be the National Guard with 
350,000 personnel and the Organized Reserve 
with 255,000 in regular training. 

The Navy under these recommendations 
will operate an active naval fleet of 652 ships 
including 238 combatant ships. Six Marine 
Corps battalion landing teams will be main- 
tained. A total of 5,900 aircraft will be oper- 
ated by the active forces, and 2,500 by the 
reserve forces. Supplementing the Navy and 
Marine Corps will be 204,850 members of 
the Naval Reserve and 50,772 of the Marine 
Corps Reserve in regular training. 

It is contemplated that the active Air Force 
will be organized into 48 groups and 13 sepa- 
rate squadrons, approximately its present 
strength. The Air National Guard and Air 
Force Reserve will be organized into 27 
groups and 25 base wings, respectively. A 
total of 8,800 airplanes, from trainers to 
heavy bombers, will be operated by the active 
Air Force, and in addition 3,400 by the Air 
National Guard and the Air Force Reserve. 

Pay and support of active duty military 
personnel, — ^The services of the officers and 
enlisted men and women on active duty will 



require 4.3 billion dollars, over one-third of 
Defense Department military expenditures. 
This will provide for pay, allowances, sub- 
sistence, travel, and clothing for the active 
forces at the new rates of pay and allowances 
set by the Career Compensation Act of 1949. 

Operation and maintenance of equipment 
and facilities, — ^Estimated expenditures of 3.3 
billion dollars will provide for operating and 
maintaining the aircraft, ships and vehicles, 
the airfields, training centers, hospitals, de- 
pots, various headquarters, ports, and other 
stations. Most of this amount will be re- 
quired for the pay of civilian employees in 
these activities. These employees constitute 
the bulk of the approximately 725,000 civil- 
ian employees expected to be engaged in 
the military functions of the Defense Depart- 
ment in 1 95 1. This represents a substantial 
reduction from the 865,000 provided for in 
the 1950 Budget. 

Civilian components. — I have consistently 
stressed the importance of the civilian com- 
ponents of our armed forces. The Army 
and Air National Guard and the Air Force, 
Army, Navy, and Marine Corps Reserves 
will require estimated expenditures of 696 
million dollars in 195 1, as compared with the 
663 million dollars estimated for 1950. This 
will provide for the training of forces total- 
ing 979,000, which approximates the number 
expected to be in regular training by the 
end of the current year. Continued im- 
provements are planned in the equipment 



63 



[g] Jan. 9 



Public Papers of the Presidents 



available to these forces and in the effective- 
ness of their training programs. In order 
to overcome a major deficiency in the pro- 
gram for these forces, I recommend that the 
Congress authorize the construction of addi- 
tional armories and similar training facilities. 
Funds for this purpose are included in the 
amount estimated for proposed legislation. 

In addition the Reserve OflScers' Training 
Corps of the Air Force, Army, and Navy 
will necessitate expenditures of 44 million 
dollars in 195 1 to provide a continuing 
source of junior officers for the reserve forces 
and a portion of the junior officers required 
by the active forces. This w^ill provide an 
estimated 19,000 new junior officers in 195 1, 
an increase of 2,000 over the estimate for 
1950. 

Research and development, — ^The experi- 
ences of the last war clearly demonstrated the 
decisive importance in modern warfare of 
superior weapons and equipment and of the 
application of scientific research to the pro- 
duction of new weapons and techniques of 
combat. In peacetime, as well as war, sci- 
entific and technical advances here and 
abroad make possible continuing improve- 
ments in the performance of military weap- 
ons, and open to us and to other nations 
the possibilities of new types of weapons 
which can profoundly affect military con- 
cepts and tactics. 

We must continue a broad and active pro- 
gram of military research and development. 
The research and development programs of 
the Department of Defense, together with 
the related programs of the Atomic Energy 
Commission, the National Advisory Com- 
mittee for Aeronautics, and other agencies 
of the Government, have as their objectives 
to develop improved weapons and equip- 
ment for the modernization of our military 
forces, to exploit the possibilities of new 
types of weapons and devise defenses against 
them, and to stimulate scientific research 



likely to have future military applications. 

Expenditures of the Department of De- 
fense for research and development in 1951 
are estimated at 606 million dollars, slightly 
less than in the current year. This amount 
includes the principal costs of the research 
and development activities, except for the 
construction of research facilities and the 
pay and support of military personnel en- 
gaged in research and development activities. 

Aircraft procurement, — ^Procurement of 
complete aircraft will require expenditures 
of 2.1 billion dollars in 1951 for approxi- 
mately 2,300 airplanes, compared with 1.7 
billion dollars for approximately 2,800 air- 
planes in 1950. The change in average unit 
cost reflects the increasing complexity and 
cost of individual airplanes. 

The recommendations in this Budget will 
provide for new contracts to be made in 195 1 
totaling 2.0 billion dollars, compared with 
1.9 billion dollars in 1950. This contem- 
plates that 851 million dollars of 1950 au- 
thorizations being held in reserve will be 
applied against requirements for aircraft to 
be contracted for in 1951. 

Approximately 3.3 billion dollars of un- 
expended authorizations contracted for in 
1950 and prior years will be carried forward 
into 1 95 1. This carry-over, together with 
the contracts to be made in 195 1, will provide 
5.3 billion dollars of complete aircraft to be 
delivered and paid for in 1951 and subse- 
quendy. Under present procurement plans 
it is estimated that, in addition to the 1951 
deliveries of 2,300 airplanes, approximately 
3,100 airplanes will be delivered in 1952 and 
later years from authorizations provided 
prior to that time. 

Construction of ships, — ^Naval ship con- 
struction will require 298 million dollars of 
estimated expenditures in 1951. While no 
new obligational authority is recommended 
in this Budget, the 195 1 expenditures will be 
only slighdy less than the 314 million dollars 



64 



Harry S. Truman, ig^o 



Jan. 9 [9] 



estimated for 1950. Various substitutions 
and adjustments have been made during the 
past year in the uncompleted portion of the 
shipbuilding program. In addition to work 
completed in 1951, 467 million dollars of 
presently authorized naval ship construction 
v^ill remain to be completed in 1952 and 
later years. 

Major procurement other than aircraft and 
ships, — Major procurement other than air- 
craft procurement and ship construction, v^ill 
require expenditures of 678 million dollars, 
a 50 percent increase over the estimate for 
the current year and more than three times 
as much as in 1949. This will provide, 
mainly, combat equipment for Army and 
Marine Corps troops, equipment for modern- 
izing the fleet, noncombat vehicles for the 
three military departments, and ammuni- 
tion, torpedoes, and guided missiles. The 
substantial increase in expenditures in 1951 
results largely from the sizable expansion in 
this program during the past 2 years. The 
new obligational authority recommended for 
195 1, totaling 755 million dollars, will be at 
a moderately higher level than 1950. This 
will continue the larger procurement pro- 
gram embarked on in 1949 and continued 
with increases in 1950. 

Amounts included for combat vehicles, 
artillery, guns, and other equipment for 
Army and Marine Corps troops will permit 
substantial modernization of the equipment 
for the ready forces, and will reflect the prog- 
ress of our research and development efforts. 
It will provide an orderly step in the replace- 
ment of the equipment left over from World 
War II which by the end of 195 1 will be at 
least 6 years old and therefore in need of 
substantial improvements in design as a 
result of technical and scientific develop- 
ments. The equipment for modernizing the 
fleet will give emphasis to the role of anti- 
submarine warfare. 

Military public wor\s, — Construction of 



military public works will result in consid- 
erably smaller expenditures in 1951 than in 
1950. This is largely because only part of 
the authorizations proposed in my 1950 
Budget were enacted. Exclusive of the con- 
struction for which legislative authorization 
will need to be made, 1951 expenditures are 
estimated at 182 million dollars compared 
with 299 million dollars for 1950. This will 
provide for such construction as housing for 
troops and their families, operational facili- 
ties, and facilities for research and develop- 
ment. The obligational authority necessary 
for additional projects not yet authorized by 
legislation are included in the tentative esti- 
mate for proposed legislation. 

Industrial mobilization, service-wide ad- 
ministration and finance, interservice proj- 
ects, and Office of the Secretary of Defense. — 
The Defense Department's part in industrial 
mobilization planning will provide for main- 
taining machine tools and stand-by industrial 
plants, for tooling of pilot production lines, 
and for placing educational orders, as well as 
for continuing industrial mobilization plan- 
ning studies with industry. Expenditures 
for this purpose are estimated at 109 million 
dollars in 1951 compared with 117 million 
dollars in 1950. 

Other Defense Department activities 
largely of service-wide nature, will result in 
expenditures estimated at 382 million dollars, 
a slight increase from 1950. 

Proposed legislation (including military 
public worlds), — In order to provide for early 
starts on projects and activities for which 
legislation is proposed I am including an 
estimate of 372 million dollars for new obli- 
gational authority, the largest part of which 
is for military public works for both regular 
and reserve forces. 

Unexpended reimbursements from mutual 
defense assistance program, — The Defense 
Department receives reimbursements for 
some of the equipment which it takes from 



41-355—65- 



65 



[9] Jan. 9 



Public Papers of the Presidents 



its stocks to ship to other countries under 
the mutual defense assistance program. 
The manufacture and delivery of equipment 
out of these reimbursements will, for the 
most part, not be possible before the follow- 
ing year. Hence these reimbursements will 
appear as credits in Defense Department 
expenditures in 1950 and 195 1. As de- 
liveries from these funds are made in future 
years, compensating increases in Defense 
Department expenditures will result. 

Pay of retired military personnel, — 
Amounts are appropriated annually to pro- 
vide the cost of pay for retired military 
personnel. The expenditures of 345 million 
dollars estimated for 1951 provide this retire- 
ment pay for persons whose services were 
for the most part rendered prior to World 
War II. The Government is at present in- 
curring obligations for future payments at a 
rate two and one-half times the current re- 
tired pay expenditures. 

Stockpiling of strategic and critical ma- 
terials, — ^The stockpile program will provide 
the means for augmenting the supplies of 
materials expected to be available to us in 
time of emergency. Accelerated progress 
toward present objectives will be made dur- 
ing the year since available supplies have 
increased somewhat, pardy as a result of 
orders placed previously to encourage new 
development. 

I recommend 500 million dollars of new 
obligational authority for this program in 
1 95 1. This amount when added to the au- 
thority already available will provide total 
authority for deliveries in 1951 and later 
years of i.i billion dollars. Expenditures 
are expected to rise from 580 million dollars 
in 1950 to 650 million dollars in 1951. 

The recommended new obligational au- 
thority will bring the funds for the stockpile 
to within 729 million dollars of the present 
total objective of 3.3 billion dollars. By the 
end of 195 1, 65 percent of the stockpile will 

OS 



be delivered, and an additional 13 percent 
will be under contract for delivery after 195 1. 
We will be nearer to our goals for the mate- 
rials the supply of which would be the most 
susceptible to interruption, than for the 
stockpile as a whole. 

National Advisory Committee for Aero^ 
nautics and other activities supporting de- 
fense, — ^Expenditures for all other activities 
supporting defense will total 43 million dol- 
lars, after deducting 48 milhon dollars of 
net receipts in the defense activities of the 
Reconstruction Finance Corporation. Slight 
increases in funds will be necessary for the 
National Advisory Committee for Aeronau- 
tics to move forward with its basic research 
activities in aeronautics. The funds for the 
National Security Resources Board will be 
maintained at about the present level, and the 
cost of maintaining industrial reserve plants 
by the General Services Administration will 
decline slightly. Other activities provided 
for include the Selective Service System as 
well as various defense activities of other 
agencies. The defense activities of the Re- 
construction Finance Corporation, having to 
do with rubber, tin, and fibers, will result 
in larger receipts than expenditures, mainly 
as a result of reduction of inventories. 

Veterans' Services and Benefits 

Expenditures of 6.1 billion dollars are esti- 
mated for veterans' programs, one-seventh 
of all Budget expenditures estimated for 
195 1. The size of these requirements re- 
flects the fivefold increase since 1939 in the 
number of living veterans and the new read- 
justment benefits provided for the World 
War II veterans, as well as the increases in 
rates of benefits and in services to veterans 
generally. 

Most of the expenditures for veterans' 
benefits and services are not controllable by 
the ordinary appropriation process. Ex- 



Harry S. Truman, ig^o 



Jan. 9 [9] 



penditures depend largely on how many of 
our 19,000,000 living veterans, and how 
many dependents of deceased veterans, apply 
and qualify for aid under some 300 laws. 
The variable impact of veterans' programs 
on the Budget is indicated by the fact that 
expenditures for the fiscal year 1950 are now 
estimated 1.4 billion dollars higher than they 
were estimated a year ago. As a result, it 
now is necessary not only to request restora- 
tion of the appropriations for the Veterans 
Administration eliminated by the last session 
of the Congress, but also to recommend addi- 
tional supplemental appropriations for 1950. 

Expenditures in the fiscal year 195 1 are 
estimated to decline 825 million dollars from 
the level for the current year. In the next 
few years we should be able to see a further 
substantial reduction in Budget expenditures 
for veterans' programs, as the temporary 
readjustment benefit programs taper off or 
expire under existing legislation. On the 
other hand, it should be recognized that 
permanent veterans' laws will necessitate 
high expenditures for many years. In par- 
ticular, expenditures for pensions and for 
hospital and medical care will continue to 
increase from year to year. 

I have called attention in previous Mes- 
sages to the responsibilities which our Nation 
has toward its veterans and to our efforts to 
assist them to resume as nearly as possible 
their normal places in our society. We have 
provided a comprehensive and complete pro- 
gram of special Government benefits for vet- 
erans of all wars — including extensive 
economic aids, education and training assist- 
ance, job reinstatement and preference 
rights, as well as extensive medical and other 
services. Veterans, as citizens, of course, are 
also benefited under the general programs 
developed in the last 15 years to maintain 
high employment and to advance the Na- 
tion's economic welfare. 

Almost 2,000,000 veterans with disabilities 



incurred in the service, and over 300,000 
families of veterans deceased from service 
causes, are now being assisted under the 
veterans' programs. Our primary long-run 
obligations in providing veterans' benefits 
and services are to this group. We must 
give them timely help to surmount the eco- 
nomic and physical handicaps sustained as 
the result of military service and to assist 
them to assume the full responsibilities of 
civilian life. In the last 2 years, substantial 
additional increases in compensation rates 
to dependents and to veterans of World Wars 
I and II have brought the rates to this group 
reasonably into line with the rise in the cost 
of living since 1939. 

The remaining 17,000,000 veterans are 
practically all without service disabilities. 
The Government has made available liberal 
benefits to help all veterans of the two world 
wars make the transition from military to 
civilian life. The veterans of World War 
II, in particular, have received readjustment 
benefits to assist them in obtaining educa- 
tion, training, jobs, businesses, and homes. 
Most of the citizen-soldiers of World War II 
returned to civilian life 4 years ago and have 
had adequate opportunity to reestablish 
themselves in their communities. The orig- 
inal, sound purposes of the Servicemen's 
Readjustment Act have largely been served. 
Some of the benefits under the act have 
already terminated and the need for others, 
such as education and training benefits, is 
drawing to a close. 

Veterans without service disabilities will 
continue to be eligible for liberal benefits 
under the permanent veterans' laws after the 
termination of temporary programs. At the 
same time, these veterans are eligible in many 
cases for benefits under the general social 
security programs of the Government. Wc 
now seek to improve and to broaden the gen- 
eral social security programs to provide pro- 
tection against the economic hazards of old 



67 



[9] Jan. 9 



Public Papers of the Presidents 



age, disability, illness, and unemployment. 
The social security proposals pending in the 
Congress apply to all the people, including 
veterans. In the pending bill to improve the 
old-age and survivors insurance system, vet- 
erans would receive credit for the period of 
military service during World War II toward 
benefits under the system. On the other 
hand, proposals are also pending in the Con- 
gress to increase gready the special programs 
for veterans, who with their dependents now 
comprise about two-fifths of our total popu- 
lation. There is real cause for concern that 
we may overlook the close relationship of 
these two systems and superimpose on the 
general system of benefits an overlapping and 
unwarranted series of special benefits for 
veterans. 

I again urge that in considering new or 
additional aids for veterans without service 
disabilities, the Congress judge their neces- 



sity not merely from the standpoint of mili- 
tary service, but also on the basis of benefits 
under the general social security, health, and 
education programs available to all the peo- 
ple, including veterans. Our objective 
should be to make our social security system 
more comprehensive in coverage and more 
adequate, so that it will provide the basic 
protection needed by all citizens. We should 
provide through the veterans' programs only 
for the special and unique needs of veterans 
arising direcdy from military service. 

I am sure that our veterans are willing to 
share with other citizens in the benefits 
which can be gained for all through a posi- 
tive program of economic and social advance- 
ment. They recognize that their best inter- 
est is inseparable from the best interest of 
the Nation. For a democratic Nation like 
ours can thrive only as all its citizens — veter- 
ans and nonveterans alike — are enabled 



Veterans' Services and Benefits 
[ Fiscal years. In millions ] 

Expenditures 



1949 
actual 



Program or agency 
Readjustment benefits (Veterans Administration) : 

Education and training $2, 697 

Unemployment and self-employment allowances . . 

Loan guarantees 

Other 

Compensation and pensions (Veterans Administra- 
tion) 

Insurance (Veterans Administration) 

Hospitals, other services, and administrative costs: 
Construction: 

Veterans Administration 

Corps of Engineers (Army) 

General Services Administration 

Current expenses: 

Veterans Administration: 

Hospital and medical care 595 

Other activities 345 

All other agencies 2 



510 
40 
87 

2,154 
95 



34 
108 

3 



1950 
estimated 



«)2,7i» 

153 

61 

105 

2,243 
518 



82 
141 

2 



584 

296 

2 



1951 
estimated 



l>2, 4»i 
61 
68 
78 

2,237 
39 



157 
97 



590 
269 

2 



"New obligational 
authority for 1951 
Appropria- 
tions 



Other 



$2, 681 



.237 
39 



C) 



607 
281 



Total 6, 669 6, 905 6, 080 ^ 5, 847 

^This Budget also includes 160 million dollars of appropriations to liquidate prior year contract author- 
izations for hospital construction. 



68 



Harry S. Truman, ig^o 



Jan. 9 [9] 



through fair and equal opportunities to live 
as self-respecting, self-reliant men and 
women in a free and prosperous country. 

Readjustment benefits. — By the end of the 
fiscal year 195 1 it is estimated that under the 
Servicemen's Readjustment Act 8,000,000 
veterans will have received education and 
training benefits at a cost of 12.9 biUion 
dollars, and that 9,000,000 will have drawn 
unemployment and self-employment allow- 
ances totaling 3.9 billion dollars. In addi- 
tion 2,400,000 veterans will have obtained 
13 billion dollars in loans for homes, farms, 
and businesses under the Government loan 
guarantee program for veterans. 

The average enrollment in school, job, and 
farm training courses under the education 
and training provisions of the Servicemen's 
Readjustment Act is expected to decline from 
1,986,000 in the current year to 1,837,000 in 
195 1 and to require expenditures of 2.5 
billion dollars. 

The education and training program, how- 
ever, is now considerably bigger than had 
been expected. The average number of 
participants in 1950 is estimated at 400,000 
above the level anticipated a year ago. 
Largely because of this unexpected increase 
I shall soon transmit to the Congress a sup- 
plemental appropriation estimate of about 
700 million dollars to cover the higher ex- 
penditures now estimated for the current 
fiscal year. The bulk of the increase is in 
schools below the college level, particularly 
in trade and vocational schools. While en- 
rollment in other courses is decreasing, 
enrollment in these courses is still increasing 
and in 1 95 1 is estimated to average 936,000 — 
41 percent higher than in 1949 and 14 per- 
cent higher than estimated for the current 
fiscal year. 

The continued expansion of enrollment in 
schools below college level, more than 4 years 
after most veterans have been returned to 



civilian life, raises the question whether this 
program still conforms to the original sound 
objectives of the Servicemen's Readjustment 
Act — ^to enable veterans to resume education 
or training interrupted by the war or to 
restore skills lost during military service. 
There is some question whether large num- 
bers of veterans enrolled in these schools are 
in fact being trained for occupations for 
which they are suited and in which they will 
be able to find jobs when they finish their 
training. I have asked the Administrator 
of Veterans' Affairs and the Director of the 
Bureau of the Budget to study this situation 
thoroughly and to recommend to me any 
corrective measures, administrative or legis- 
lative, which should be taken to assure that 
our expenditures for this program yield a 
proper return both to the veterans and to the 
Nation as a whole. 

Since July 1949, under the terms of the 
"GI bill", veterans discharged from service 
remain eligible for unemployment and self- 
employment allowances for only 2 years 
after date of discharge. On the average 
59,000 claimants are expected to draw allow- 
ances, estimated at 61 million dollars, in the 
fiscal year 195 1. This compares with an 
average of 1,400,000 veterans receiving al- 
lowances in the peak year of this program, 
fiscal year 1947. 

Under the Government loan guarantee 
program, it is expected that 386,000 veterans 
will obtain loans, almost all for homes, 
amounting to over 2 billion dollars in the 
fiscal year 1951. The estimated oudays of 
68 million dollars for this program are chiefly 
for the payment of the first year's interest on 
the guaranteed portion of the loans. Ex- 
penditures for losses on defaulted loans are 
now relatively small, although the contin- 
gent liability is sizable since the amount of 
the Government guarantees is now about 48 
percent of the total loans. In addition to 



69 



[9] Jan. 9 



Public Papers of the Presidents 



guaranteeing veterans' loans, the Govern- 
ment also purchases guaranteed mortgages 
held by financing institutions. (Mortgage 
purchases are classified under housing and 
community development.) 

The "other" expenditures for readjust- 
ment benefits cover allov^ances for burial 
expenses of veterans, tuition and supplies for 
disabled veteran trainees, and Government 
grants for special housing for certain se- 
riously disabled veterans. 

Compensation and pensions, — It is esti- 
mated that an average of 3,058,000 individ- 
uals and families will receive compensation 
and pension payments totaling more than 
2.2 billion dollars in the fiscal year 1951. 
Beginning in 1951 disability retirement pay- 
ments of 78 million dollars to 31,000 Reserve 
officers, shov^^n in this item in prior years, 
have been transferred to the military retired 
pay account of the Department of Defense. 
Apart from this reclassification to national 
defense, there is an estimated net increase 
in 1 95 1 of 99,000 in the average number of 
cases, and of 71 million dollars in expendi- 
tures over the current year, entirely for cases 
v^ithout service disabilities. 

The 1 95 1 expenditure estimate of 2.2 bil- 
lion dollars includes 1.5 billion dollars in 
compensation for service-connected cases, 
covering an average of 344,000 families of 
deceased veterans and 1,981,000 veterans 
with disabilities. The compensation and 
pension total also includes 160 million dol- 
lars for subsistence allowances to service- 
disabled veterans in the vocational education 
and training program. Pension payments to 
an average of 732,000 non-service-connected 
cases in 1951 are estimated to total 553 mil- 
lion dollars, about two-thirds to living vet- 
erans and one-third to survivors of deceased 
veterans. 

Insurance. — ^The Government reimburses 
the veterans' life insurance trust funds for 



payments on account of deaths traceable to 
war hazards, and also pays directly certain 
claims to veterans who failed to meet the 
regular standards of insurability. The ex- 
penditures in the fiscal year 1950 include 
nonrecurring transfers of 413 million dollars 
to the national service life insurance fund 
arising from a resurvey of the Government's 
liability for such contributions. Expendi- 
tures in 195 1 for insurance claims payable by 
the Government are estimated at 39 million 
dollars. 

Hospital and domiciliary construction, — 
Construction of hospitals to provide 37,000 
new beds and additional domiciliary facili- 
ties, costing 872 million dollars, is now about 
one-third completed. By June 1951 it is 
estimated that three-fourths of the work will 
have been done. When this program is fin- 
ished, there will be sufficient beds to provide 
adequately for foreseeable needs for all 
service-connected cases and a more liberal 
allowance of beds than at present for non- 
service-connected cases. Obligational au- 
thority already available is more than ade- 
quate to meet the needs of the program now 
under way. 

Hospital and other services and adminis- 
tration. — Current expenses for hospital and 
medical care are estimated at 590 million dol- 
lars in the fiscal year 195 1. About four- 
fifths of these expenditures are for the in- 
patient care program, and in this program 
two-thirds of the cases currently are non- 
service-connected. A daily average of 
138,000 patients in hospitals and homes is 
estimated for 195 1, about 9,000 more than 
were cared for in 1949 and 4,000 more than 
in the current year. The other one-fifth of 
the expenditures is largely for the outpatient 
medical and dental care programs. 

Other current expenses, which are chiefly 
the costs of administering and operating the 
nonmedical benefits programs and of general 



70 



Harry S. Truman, igp 

Veterans' Life Insurance Funds 

{Trust accounts) 

[ Fiscal years. In millions ] 

Item 
Receipts: 

Transfers from general and special accounts 

Interest on investments 

Premiums and other 

Total 

Expenditures: 

Dividends to policyholders 

Benefits and other 

Total 

Net accumulation 



administration of the Veterans Administra- 
tion, are estimated to decline in 1951 to 269 
million dollars. 

Trust accounts, — ^The national service life 
insurance and Government life insurance 
trust funds operate as mutual insurance sys- 
tems on a commercial pattern, except that 
no administrative expenses are paid by them 
and the amounts held in reserve and as sur- 
plus are invested in Government obligations 
by the Secretary of the Treasury. Veterans 
of World Wars I and II and present service- 
men now^ hold about 6,800,000 active policies 
in these two systems. Premiums and earn- 
ings, supplemented by Government pay- 
ments of over 4 billion dollars for claims in- 
volving deaths and disabilities resulting from 
extra hazards of military service, have built 
up assets in these two funds to an estimated 
9.7 billion dollars at the present time. 

The Government life insurance fund has 
been on a dividend-paying basis since 1921. 
A special dividend of 40 million dollars was 
paid early in the fiscal year 1950. The first 
national service life insurance dividend, 
amounting to an estimated 2.8 billion dollars 
and payable to all servicemen of World War 
II who hold or have held policies, has been 
declared. Payments are now scheduled to 



1949 
actual 



255 
431 

775 

II 

382 

393 

382 



Jan. 9 [9] 



1950 1951 

estimated estimated 



$487 
261 
446 

1,194 

2,303 
427 

2,730 

—1,536 



$33 
210 
465 

708 

563 
436 

999 
-291 



begin shortly. It is estimated that 2.2 billion 
dollars will be disbursed in the current fiscal 
year and the balance in 1951 or later, as 
applications are filed. In the next few years 
a regular dividend schedule is to be estab- 
lished for national service life insurance. 
These dividends are not a Budget expendi- 
ture since they are paid from the trust funds. 

Social Welfare, Health, and Security 

The coming year will be an extremely 
significant one for the Nation's social secu- 
rity program. The decisions of the Con- 
gress on pending legislation will determine 
the direction which this country will follow 
in providing basic protection against the 
major economic hazards of old age, unem- 
ployment, illness, and disability. It is my 
strong belief that it is a responsibility of the 
Government to provide this protection, and 
to provide it in a manner that is consistent 
with our ideals of independence and self- 
reliance — ^through the already established 
and tested principle of contributory social 
insurance. This was the basic philosophy 
of the Social Security Act, in which the 
major role was given to social insurance, 
financed mutually by employers and em- 



71 



[p] Jan. 9 



Public Papers of the Presidents 



ployees, with benefits available as a matter of 
right without a means test. Public assist- 
ance was given only a supplementary role 
to fill in the diminishing gaps in insurance 
protection. 

The effects of our failure in recent years 
to carry out this philosophy are already 
dramatized by the increase in the public 
assistance rolls. Because the protection of 
social insurance is so limited and inadequate, 
far too many people have been forced to 
seek public relief. In some States, for ex- 
ample, half the aged people are on the relief 
rolls. Approximately 2,700,000 aged people 
and 1,500,000 dependent children now re- 
ceive public assistance. By contrast, only 
1,900,000 aged persons receive insurance 
benefits and 800,000 children and their 
mothers receive survivors benefits under the 
old-age and survivors insurance system. 
Average old-age insurance benefits are only 
26 dollars a month compared with average 
old-age public assistance benefits of 45 
dollars. 

Public demand for some form of basic 
financial protection against loss of earning 
power is evident in the keen interest of wage 
earners in industrial pension and insurance 
plans. There can be no question that our 
society can and should provide such protec- 
tion. What I wish to emphasize is that the 
basic approach should be through a compre- 
hensive public program of old-age, survivors, 
and disability insurance, rather than through 
a multiplicity of unrelated private plans, 
which would inevitably omit large numbers 
of the working population and treat others 
unequally. Private plans and voluntary in- 
surance can then provide desirable supple- 
mental protection. 

I urge that the Congress enact legislation 
to expand and improve the old-age and sur- 
vivors insurance system in accordance with 
the recommendations made last spring. 
Specifically, nearly all gainfully employed 



people, including farmers and the self-em- 
ployed, should be covered; benefits should 
be increased sharply; and disability should 
be added to the risks covered. It is also 
important that the tax base be raised to the 
first 4,800 dollars of earned income, not only 
to reflect changes in wage levels since 1939, 
but also to bring both receipts and benefits 
to proper levels. 

The recommended program will cover 
about 85 percent of all employed people, and 
will thus gradually reduce the need for pub- 
lic assistance. In the meantime, however, 
it is necessary to provide some help for those 
persons not yet protected by social insurance, 
as well as for those who would need public 
aid even with an adequate social insurance 
system. I therefore renew my recommen- 
dation of last year that the program of Fed- 
eral grants to States for public assistance be 
extended and improved. The proposal that 
I submitted to the Congress last spring was 
designed to permit Federal sharing in the 
cost of aid to needy persons excluded from 
the present program, as well as in the cost 
of essential medical and welfare services. 
It was also designed to make Federal grants 
more responsive to the financial resources of 
each State. Within the framework of gen- 
eral policy under the Social Security Act, the 
States are responsible for determining the 
size of benefit payments and the eligibility 
of individuals for assistance. In adopting 
amendments to the present program, we 
should continue to rely on the States to bear 
a considerable share of the financial responsi- 
bility. 

In the field of health, I presented a set of 
recommendations to the Congress on April 
22, 1949, oudining in some detail a program 
for the Nation, centering in a national sys- 
tem of medical-care insurance. Since that 
time, the extension and enlargement of the 
hospital construction program which I rec- 
ommended has been enacted, and consider- 



72 



Harry S. Truman, ig^o 



Jan. 9 [9] 



able headway has been made on some of my 
other recommendations. I hope that the 
Congress will soon complete action on leg- 
islation to increase Federal assistance to local 
health services. Strengthening of these is 
fundamental to our national health. In 
addition, legislation should be enacted to 
provide financial aid to medical and related 
schools to encourage the training of addi- 
tional medical personnel. In the case of 
nurses, tuition scholarships and subsistence 
aids should be made available for training 
graduate nurses, and grants should be made 
to States for vocational education for prac- 
tical nurses, to encourage more young 
women to enter the profession. 

To fill in a major gap in our social security 
system, I again strongly urge the adoption 
of legislation providing for a comprehensive 
system of prepaid medical care insurance. 
This should be geared in with our other 
social insurance programs and financed pre- 
dominandy by employer and employee 
contributions. 

Action on these measures should no longer 
be delayed. We cannot in good conscience 
let our social security system remain in the 
blueprint stage, and allow relief programs to 
become our primary defense against want. 

This Budget contains estimates for all of 
my proposals. The greater part of them 
would be financed through special taxes, 
with receipts going into Government trust 
funds and payments being made directiy 
from the funds. Social insurance benefits, 
by providing support for the aged and disa- 
bled and their dependents, help to relieve 
individual families, employers, and commu- 
nities of this burden. At the same time, by 
replacing the present haphazard arrange- 
ments with a comprehensive pattern of social 
insurance, we promote the stability of the 
economy and preserve the self-respect of all 
our citizens. 

My proposals will add an estimated 271 



million dollars to Budget expenditures in 
1 95 1, principally in the form of grants to 
States. Of this amount, 200 million dollars 
is for improvement of public assistance and 
67 million dollars for health programs. 
These items, plus increases under existing 
legislation in these two fields, are expected 
to cause Budget expenditures for social wel- 
fare, health, and security to rise in the fiscal 
year 195 1 to a level of 2.7 billion dollars, an 
increase of 417 million dollars over the cur- 
rent year. Aside from proposed legislation, 
the primary cause of the increase is a rise in 
grants to States for public assistance and 
hospital construction. Included in the total 
is 594 million dollars representing the trans- 
fer of pay-roll tax receipts to the railroad 
retirement trust fund. 

I recommend again that the Federal Secu- 
rity Agency be given departmental status; 
its functions are so important to the domestic 
policies of the Government that the head of 
this Agency should be a member of the 
President's Cabinet. 

Assistance to the aged and other special 
groups, — Grants-in-aid to States for public 
assistance to the needy aged, the blind, and 
dependent children are expected to reach 1.2 
billion dollars in 195 1 under the present pro- 
gram, with the Federal share averaging 
about 52 percent of total payments by State 
and local governments to these groups. For 
some time, the number of recipients has been 
increasing and now exceeds 4,000,000 per- 
sons; it is expected to average 4,600,000 dur- 
ing 195 1. Average benefits are also expected 
to continue their rise. As a result. Federal 
expenditures will exceed those for the current 
year by an estimated 55 million dollars. The 
Budget contains an additional 200 million 
dollars as the first-year expenditure estimated 
for proposed legislation to cover all the needy 
and to put the program on a variable grant 
basis. The revised formula which I have 
recommended would relate grants to the 



73 



[9] Jan. 9 



Public Papers of the Presidents 



Social Welfare, Health, and Security 
[ Fiscal years. In millions ] 



Expenditures 

1949 1950 1951 

actual estimated estimated 



"New obligational 
authority for 1951 
Appropria- 
tions Other 



$922 $1, 146 



15 



26 



4 
75 

579 
5 



161 



2 

83 

603 
10 



259 



8)1, 201 
250 

24 

4 

2 



594 

7 



Program or agency 
Assistance to the aged and other special groups: 
Federal Security Agency: 
Public assistance: 

Present programs 

Proposed legislation 

Vocational rehabilitation: 

Present programs 

Proposed legislation 

Other 

School lunch (Department of Agriculture) 

Retirement and dependents' insurance: 

Railroad Retirement Board 

Federal Security Agency and other 

Promotion of public health: 
Federal Security Agency: 

Present programs 

Proposed legislation: 

Aid to medical education 

Local health services 

Children's Bureau grants 

School health services 

General Services Administration and other 

Crime control and correction (Department of Justice 

and other) 

Indian welfare (Interior) and other 

Accident compensation (Federal Security Agency) . . 

Total 1, 907 2, 297 2, 714 ^ 2, 625 165 

^This Budget also includes 151 million dollars of appropriations to liquidate prior year contract author- 
izations. 



$1,201 
200 

24 

4 

2 

83 

594 
7 



334 



190 



$163 







30 


45 








5 


5 








7 


10 








25 


35 




10 


21 


32 


6 




88 


93 


99 


lOI 


I 


32 


29 


39 


39 


I 


15 


25 


28 


28 





financial resources of the individual States 
and would also permit the Federal share to 
be held within reasonable limits. 

I am also proposing legislation to 
strengthen the Federal-State program of vo- 
cational rehabilitation and to provide addi- 
tional opportunities for rehabilitation of the 
more severely handicapped. By enabling 
these people to become productive workers, 
instead of liabilities to their families and 
communities, we are enhancing our national 
supply of skills and productive ability. The 
Budget includes 4 million dollars for the first 



year under the proposed legislation. 

Railroad retirement insurance. — The 
amount of 594 million dollars included as an 
expenditure in the Budget is actually the 
transfer of special tax receipts to a trust ac- 
count for payment of benefits to retired rail- 
road workers and their survivors. Apart 
from credits for military service, the program 
is financed by taxes on railroad wages, shared 
equally by employees and employers. Under 
present law, the transfers of tax receipts to 
the fund must be made in advance of col- 
lection and thus interest begins to accrue 



74 



Harry S. Truman, i^p 



Jan. 9 [9] 



to the fund before the taxes are collected. To 
avoid this payment of interest on money not 
yet received, the Congress should direct that 
these taxes be transferred to the trust fimd 
when received, as is now done with the old- 
age and survivors insurance taxes. 

I recommend also that the Congress revise 
the procedure for making Federal Govern- 
ment payments for military service credits 
allowed to railroad employees. Such pay- 
ments to the railroad retirement trust fund 
should be made annually in the years ahead 
on the basis of claims actually approved as 
workers retire. As the law now stands, 
these payments are made in advance, with- 
out adequate relationship to eventual re- 
quirements for actual benefits. To cover 
such future claims, 193 million dollars has 
already been advanced to the trust fund. 
Unless the law is amended as recommended 
in this Budget, further payments of approxi- 
mately 33 million dollars will be required 
in each of the next four fiscal years. 

Promotion of public health, — ^Federal ex- 
penditures for public health are mainly for 
grants-in-aid to States and for research. Of 
the 334 million dollars estimated for existing 
programs in the fiscal year 1951, 213 million 
dollars is for financial assistance to the States 
for general public health services and for a 
wide variety of special State and local pro- 
grams, including hospital construction, 
maternal and child health, tuberculosis con- 
trol, and mental health. The increase of 75 
million dollars in expenditures over 1950 for 
existing programs is caused largely by a rise 
in grants to liquidate prior years' hospital 
construction authorizations. This program 
is helping communities throughout the Na- 
tion to reduce the hospital shortage. 

Because adequate general public health 
services are basic in our health program, I 
am recommending that grants for this pur- 
pose be increased by 9 million dollars, bring- 



ing them up to 23 million dollars, the max- 
imum authorized under existing law. An 
additional 5 million dollars is included for 
proposed legislation to increase these grants 
beyond the existing ceiling. At the present 
time, most of the counties of this Nation 
lack, either wholly or in part, the basic local 
public health services which must form the 
foundation for our efforts to improve the 
Nation's health. The increase permitted by 
existing law will provide only a start toward 
meeting this serious deficiency. New leg- 
islation is, therefore, needed to remove the 
existing statutory ceiling and provide a 
sound basis for aiding States in the future 
development of adequate local health 
services. 

Other proposed legislation is expected to 
add 62 million dollars to expenditures, of 
which 30 million dollars is for aid to med- 
ical education to increase enrollments in 
schools of medicine, nursing, dentistry, and 
public health, and 7 million dollars is for 
expansion of health and welfare services to 
mothers and children. Expenditures under 
pending legislation authorizing special 
health services to school children are esti- 
mated at 25 million dollars. 

The direct research activities of the Public 
Health Service and the grants to individuals 
and institutions for research, teaching, and 
training, will require an estimated 47 million 
dollars in 195 1, a moderate increase over 
1950. No provision is made in this Budget 
for further expansion of Public Health Serv- 
ice grants to medical schools for under- 
graduate teaching and for construction of 
additional research facilities on the basis of 
special disease categories. This anticipates 
early enactment of legislation for general aid 
to medical education, which would contain 
adequate provisions for aid to medical schools 
in meeting their costs of teaching and in 
constructing additional facilities. Such legis- 



75 



[9] Jan. 9 



Public Papers of the Presidents 



lation would permit an integrated program 
of research and teaching at medical schools, 
which should be far more conducive to good 
results than separate financing for each 
major type of disease. 

Trust accounts, — Under the old-age and 
survivors insurance, railroad retirement, and 
Federal employee retirement programs, 
benefit disbursements are made from the 
trust funds and are not included in Budget 
expenditures. On the receipts side, the pay- 
roll contributions for old-age and survivors 
insurance are transferred directly to the trust 



fund and not included in total Budget re- 
ceipts. Receipts and payments under the 
proposed health insurance program would 
also be handled in this manner. Railroad 
retirement taxes, on the other hand, are 
included in total Budget receipts and are 
transferred to the trust account as a Budget 
expenditure. The Government contribution 
to its employee retirement funds is, of course, 
a Budget expenditure (classified under gen- 
eral government). 

The money in these trust funds is invested 
in Government securities, and the interest 



Social Welfare, Health, and Security 
{Major trust accounts) 

[ Fiscal years. In millions ] 

Fund and item actual 

Federal old-age and survivors insurance trust fund: 
Receipts: 

Appropriation from general receipts |i, 690 

Interest and other 233 

Proposed legislation extending coverage, raising tax base, and 

adding disability benefits 

Payments of benefits and administrative expenses: 

Present programs — 660 

Proposed legislation 

Net accumulation (including proposed legislation) i, 263 

Railroad retirement account: ==: 
Receipts: 

Transfers from Budget accounts 574 

Interest on investments 51 

Payments of benefits, salaries, and expenses — 278 

Net accumulation 347 

Federal employees' retirement funds: = 
Receipts: 

Employee contributions 328 

Transfers from Budget accounts and other 230 

Interest 124 

Payments of annuities and refunds, and expenses —221 

Net accumulation 460 

Medical care insurance trust fund (proposed legislation): == 

Receipts from pay-roll contributions 

Payment for initial expenses 

Net accumulation 

76 



1950 

estimated 


1951 
estimated 


$2, 245 
261 


$2,515 
303 




I, 200 


-783 


-867 




~-i»433 


1,723 


1,718 


602 

61 

—314 


594 

64 

—346 


349 


312 


374 


353 


306 

140 

—255 


337 

163 

-276 


566 


578 




250 




—35 




215 



Harry S. Truman, i^p 



Jan. 9 [9] 



earned is added to the principal of each trust 
fund. Accumulated assets now total 18 
billion dollars. 

Under present law, the old-age and sur- 
vivors insurance tax rate advanced on Janu- 
ary 1, 1950, to 1 54 percent each for employers 
and employees. In view of the recom- 
mended increase in benefits and addition of 
disability coverage, I propose that the further 
tax increase to 2 percent each, presently 
scheduled for January i, 1952, be moved up 
to January i, 1951, The proposed legisla- 
tion would raise benefits in the fiscal year 
195 1 from about 800 million dollars under 
existing law to approximately 2.2 billion 
dollars. Thereafter disbursements for bene- 
fits can be expected to climb gradually as 
claims mature. The 4 percent combined 
tax should produce revenues of approx- 
imately 5 billion dollars a year with employ- 
ment at a high level, so that for the next 
several years reserves would continue to 
accumulate. 

A period of preparation will be required 
to set up the health insurance system. I am 
proposing that in the meantime a small 
pay-roll tax of one-fourth of i percent each 
on employers and employees become effec- 
tive January i, 195 1, to defray initial ex- 
penses. Setting up this tax will also make 
possible the establishment of eligibility and 
other administrative records. 

Housing and Community Development 

Last year the Congress adopted as the 
declared objective of national housing policy 
"a decent home and suitable living environ- 
ment for every American family." Real 
progress has been made toward achieving 
this goal. Private enterprise, with extensive 
Government assistance, built a million new 
houses last year, more than ever before, and 
at generally reduced prices. Far-sighted 
new legislation was enacted, which gives 



practical support to private and local initia- 
tive in clearing slums and developing our 
cities, in providing special assistance for low- 
income families in cities and on farms, and 
in promoting better methods and lower costs 
for all types of housing construction. 

Our task this year is twofold. We must 
continue to push ahead rapidly in carrying 
out these major new programs. We must 
also further improve Federal housing legis- 
lation. In particular, to close the biggest 
remaining gap, I am recommending legisla- 
tion which will aid middle-income groups to 
obtain adequate housing they can afford. 

Budget expenditures for housing and com- 
munity development are estimated at 1.3 
billion dollars in 195 1. Of this total, almost 
I billion dollars, or about 75 percent, repre- 
sents the current estimate of expenditures for 
mortgage purchases by the Reconstruction 
Finance Corporation to support the private 
mortgage market. The Corporation will 
subsequently be reimbursed for its expendi- 
tures in buying these mortgages, either 
through collections or through sale to private 
institutions. 

Most of the Federal expenditures for hous- 
ing and community development, including 
mortgage purchases, are financed by public 
debt authorizations rather than by appro- 
priations. The public housing and urban 
redevelopment programs will require rela- 
tively small appropriations in the early years, 
with substantial increases in later years. The 
Federal Housing Administration insures 
each year about 3 billion dollars in private 
home mortgages, but since this is an insur- 
ance operation it has only a minor effect on 
current Budget expenditures. 

Federal Housing Administration, — ^Al- 
most half the record volume of private new 
housing now under construction is being 
financed with mortgages insured or guaran- 
teed by the Federal Government, largely by 
the Federal Housing Administration, and 



77 



b] Jan. 9 



Public Papers of the Presidents 

Housing and Community Development 
[ Fiscal years. In millions ] 



Expenditures 



"New obligational 
authority for 1 9S I 



Program or agency 
Aids to private housing: 

Housing and Home Finance Agency: 

Federal Housing Administration (present pro- 
grams and proposed legislation): 

Current operations 

Investments in United States securities 

Home Loan Bank Board: * 

Home Owners' Loan Corporation 

Federal Savings and Loan Insurance Corpora- 
tion: 

Current operations 

Investments in United States securities .... 
Loans to middle-income cooperatives (proposed 

legislation) 

Reconstruction Finance Corporation: 

Mortgage purchases 

Loans to prefabricators and builders, and other. 
Loans to housing cooperatives (proposed legis- 
lation) 

Department of Agriculture 

Public housing program: 
Housing and Home Finance Agency: 
Public Housing Administration: 

Low-rent housing 

War housing and other 

Reconstruction Finance Corporation and other .... 
General housing aids: Housing and Home Finance 

Agency 

Slum clearance and community development (in- 
cluding community facilities): 

Housing and Home Finance Agency 

Reconstruction Finance Corporation 

General Services Administration and other 

Disaster relief (proposed legislation) 

Total 



79^9 igso 1951 Approprta- 

actual estimated estimated tions 



Other 



-$33 
30 

— 119 — 



-15 
15 



407 
25 



-II 
53 



-83 



282 



42 
198 



— 16 
17 



940 
52 

10 

20 



99 

19 

— I 



II 

18 
20 



-$30 
31 

— 134 



18 
50 

990 

45 

30 

45 



136 

—3 
— I 



58 

48 

50 

5 



S35 



$25 
250 



50 



41 



30 
5 



325 
54 



1,006 1*329 ^117 704 

* Stand-by borrowing authority of 1,750 million dollars is recommended to become available in 1950. 
'This Budget also includes 18 million dollars of appropriations to liquidate prior year contract author- 
izations. 



also by the Veterans Administration (classi- 
fied under veterans' services and benefits). 
By removing all major risks from mortgage 
lending, these insurance and guarantee pro- 
grams make is possible for American families 
to buy housing on substantially better terms 



78 



than they could obtain otherwise. About 
350,000 other families now live in rental 
housing which was financed by Government- 
insured mortgages. In the case of both sales 
and rental housing, established procedures 
of the Federal Housing Administration, in- 



Harry S. Truman, ig^o 



Jan. 9 [9] 



eluding inspections, provide assurance that 
recognized housing standards are met. 

As long as favorable economic conditions 
continue, income from premiimis and other 
sources v^ill exceed expenses and permit sub- 
stantial investment in Government securities 
to build up reserves against possible later 
losses. 

In the past year the mortgage insurance 
program has successfully stimulated con- 
struction of rental housing and lower-cost 
housing for sale. I have already recom- 
mended additional legislation to encourage 
further the construction of lower-cost hous- 
ing for sale. I shall shortly transmit recom- 
mendations to provide, on a permanent 
rather than an emergency basis, a more ef- 
fective stimulus to lower rental housing. 
For both rental and sales housing, the new 
proposals would also provide needed incen- 
tives to construction of units of adequate size 
for family living. 

Reconstruction Finance Corporation, — 
Since last spring, the Federal National Mort- 
gage Association, a subsidiary of the Recon- 
struction Finance Corporation, has been 
making heavy purchases of mortgages from 
private lenders, of which the major portion 
is guaranteed by the Veterans Administra- 
tion. These purchases have made it possible 
for veterans in all parts of the country to buy 
houses on the advantageous terms offered 
under the Servicemen's Readjustment Act. 
Substantial commitments to purchase mort- 
gages insured by the Federal Housing Ad- 
ministration have also been particularly help- 
ful in assuring the availability of adequate 
funds for rental housing construction. 

The continuing need for a stand-by sec- 
ondary market does not mean that Govern- 
ment purchases should be regarded as a 
permanent substitute for private financing. 
Accordingly, the administration of this pro- 
gram will be directed toward encouraging 
private lenders to hold a larger portion of 



these mortgages as well as to repur- 
chase the mortgages previously sold to the 
Federal Government. Important adminis- 
trative steps are being taken but they can be 
only gradually effective, and substantial fu- 
ture expenditures will be necessary to carry 
through on the large volume of commitments 
already outstanding. Estimated commit- 
ments will exhaust the present authorization 
of 2.5 billion dollars shordy after the close 
of the current fiscal year. Because the rate 
of commitment is uncertain, I am recom- 
mending an additional 500 million dollars 
in public debt authorizations in fiscal year 
1950 and 250 million dollars in 1951. 

Prospective expenditures for mortgage 
purchases cannot be estimated accurately, 
since their amount depends largely on 
whether private lenders decide to hold the 
mortgages as permanent investments or to 
sell them to the Government. For example, 
the initial estimate a year ago of 200 million 
dollars in such purchases for the fiscal year 
1950 was later revised upward to 1.3 billion 
dollars and is now reduced to 940 million 
dollars. 

The Reconstruction Finance Corporation 
also has special authority to lend up to 50 
million dollars to producers of prefabricated 
housing and large-scale builders using ad- 
vanced construction methods. I recom- 
mend that the Corporation be authorized to 
lend an additional 25 million dollars for 
these and related purposes. The accom- 
plishments of this program to date have been 
below our expectations, but the potential 
benefits from the development of new hous- 
ing production methods are so great that I 
believe a further limited investment of Fed- 
eral funds, building upon the experience al- 
ready gained, will yield good returns. 

Cooperative housing for middle-income 
families, — Even with these various Federal 
aids, enough private housing of the right 
types is not yet being produced generally 



79 



[9] Jan. 9 



Public Papers of the Presidents 



throughout the country at prices which fam- 
ilies with modest incomes can afford. As a 
necessary supplement to our other housing 
programs, I am recommending new leg- 
islation to authorize Federal assistance to 
cooperatives and nonprofit corporations in 
building and managing housing projects. 
Under the plan I am proposing, the Federal 
Government would provide technical assist- 
ance in organizing housing cooperatives and 
adequate arrangements for their financing. 
Through financial and other savings, mate- 
rial reductions in rents or charges are 
anticipated. 

Because of the limited American experi- 
ence with housing cooperatives, this pro- 
gram initially must be viewed as experimen- 
tal, and cannot be expected to attain a large 
volume in 195 1. With proper Federal lead- 
ership and assistance, however, it offers real 
promise that middle-income families will be 
able to help themselves obtain good housing 
at costs within their means. 

Home Loan Ban\ Board, — This Board 
supervises the operation of the Home Own- 
ers' Loan Corporation, the Federal home- 
loan banks, and the Federal Savings and 
Loan Insurance Corporation. 

The Home Owners' Loan Corporation is 
rapidly liquidating the remainder of its 
mortgages by selling them to private lenders. 
During the depression years, the Corpora- 
tion made more than 3 billion dollars in 
loans, thus enabling over 1,000,000 families 
to keep their homes. By the end of the fiscal 
year 1951, all of these loans will be repaid 
or sold. 

Savings and loan associations supervised 
by the Federal home-loan banks provide 
roughly a third of all home-mortgage financ- 
ing. The share accounts of most of these 
associations are insured by the Federal Sav- 
ings and Loan Insurance Corporation. The 
favorable experience of these associations in 
recent years has permitted the Corporation 



to build up reserves against possible future 
losses. To further protect investors in these 
associations in the event of future emergency, 
I again recommend legislation to provide, on 
a stand-by basis, authority for both the Fed- 
eral home-loan banks and the Insurance 
Corporation to borrow from the Treasury. 
These provisions, which should become ef- 
fective in 1950, would be roughly compara- 
ble to the Federal assistance already available 
for the commercial banking system. As in 
the case of the banking system, moreover, 
they should be accompanied by measures to 
authorize more rapid repayment of the Fed- 
eral Government's investment in these in- 
stitutions, and to provide more effective and 
specific authority for the Home Loan Bank 
Board to regulate lending by the member 
institutions. 

Farm housing, — ^During the first 2 years 
of the new farm housing program, about 
40,000 low-income farmers will receive help 
in obtaining better housing. In 1951, the 
Department of Agriculture will lend an es- 
timated 45 million dollars, as well as provide 
general technical assistance and some direct 
grants for farm repairs and improvements. 

Public housing programs, — ^The Public 
Housing Administration and local housing 
authorities throughout the country have been 
taking the steps necessary to get the new 
low-rent public housing program promptly 
under way. Preliminary loans have already 
been authorized to assist 227 communities 
plan projects which will comprise an esti- 
mated 220,000 dwelling units. 

Our goal is to have 175,000 units under 
construction or completed by the end of the 
fiscal year 1951. Most of the Federal ex- 
penditures during this period will be for 
temporary loans for planning, site acquisi- 
tion, and initial construction. Private funds 
will be used for much of the construction 
financing and nearly all of the permanent 
financing. The Federal Government indi- 



80 



Harry S. Truman, igp 



Jan. 9 [9] 



rectly guarantees the local housing authority 
obligations issued for these purposes by con- 
tracting to pay annual contributions suffi- 
cient to maintain the low rents required for 
the projects. 

In addition, the Public Housing Adminis- 
tration supervises the management and dis- 
position of 450,000 permanent and tempo- 
rary housing units constructed to meet 
emergency war and veterans' needs. In the 
fiscal year 195 1, an estimated 20,000 per- 
manent units will be sold and 38,000 tem- 
porary units will be transferred to local 
agencies or demolished. This disposition of 
both types of housing can be accelerated if 
the Congress enacts the amendments to basic 
legislation which I have previously recom- 
mended. Expenditures of these programs 
are more than covered by receipts from sales 
and rentals; in addition to covering current 
expenses, receipts from sales and rentals will 
result in 62 million dollars in miscellaneous 
receipts to the Treasury in the fiscal year 
1951. 

General housing aids, — Under recent 
legislation, the Housing and Home Finance 
Administrator is initiating the comprehen- 
sive program of housing research which I 
have long advocated as a necessity to achieve 
our national housing objective. The long- 
range objective of this program is to improve 
knowledge about housing in order to aid in 
cost reduction and in stimulating the in- 
creased and sustained production of housing. 
Emphasis is being placed upon development 
of research plans with full participation by 
other interested public and private groups, 
so as to assure the maximum possible utiliza- 
tion of existing information and research 
facilities. 

Slum clearance and community develop- 
ment, — Orderly development and redevelop- 
ment of our cities and metropolitan areas is 
essential if we are to realize the full potential 
growth in production and living standards 



in the decades to come. Each city clearly has 
the primary responsibility for initiating and 
carrying through the far-reaching recon- 
struction plans required to meet its peculiar 
needs. 

Under the provisions of the new slum 
clearance and community redevelopment 
program, the Federal Government now can 
provide financial assistance needed to aug- 
ment local resources. Actual development 
will necessarily proceed gradually, area by 
area, with carefully planned provision for 
the housing of families displaced from slum 
areas and for the uses most appropriate for 
the redeveloped areas. For the first 2 years 
of the program, Federal expenditures will 
comprise loans to local public agencies to 
help them prepare plans and begin acquisi- 
tion of sites. When acceptable local project 
plans are presented, the Federal Government 
contracts to pay a maximum of two-thirds of 
all net project costs. Contracts for loans 
and grants up to 325 million dollars for the 
fiscal year 195 1 are authorized in the basic 
statute. The grants will not actually be paid 
until several years hence when the land as- 
sembly projects are completed, the redevel- 
oped land sold or leased, and net project 
costs finally determined. 

The Reconstruction Finance Corporation 
will continue to lend to public agencies for 
transit lines, tunnels, and other self-liqui- 
dating projects in cases where private fi- 
nancing is not initially available on reason- 
able terms. Private refinancing last year of 
the large outstanding loan to the Triborough 
Bridge and Tunnel Authority has made suf- 
ficient funds available to finance the new 
commitments currendy anticipated. 

Under legislation enacted last year, the 
General Services Administration is again 
making advances to State and local govern- 
ments for public works planning. These ad- 
vances are repayable when the actual con- 
struction occurs. The 2-year program of roo 



81 



[g] Jan. 9 



Public Papers of the Presidents 



million dollars will permit preparation of 
plans for public works estimated to cost more 
than 3 billion dollars. Every effort is being 
made to achieve proper coordination in the 
planning of Federal, State, and local public 
works and to emphasize projects most appro- 
priate in the event of possible economic 
emergencies. 

Major disasters in the future as in the past 
will from time to time require prompt Fed- 
eral assistance to stricken communities. I 
again urge enactment of pending legislation 
to provide in advance adequate funds to 
meet such needs. 

Education and General Research 

If education and research are to play their 
full role in strengthening our democratic so- 
ciety, we must expand our basic research, we 
must devise types of education that will pre- 
pare youth more effectively for participation 
in modern society, and we must provide bet- 
ter educational opportunities for more of our 
people. 

It is predominantly a responsibility of all 
government — ^local, State, and Federal — to 
provide for the education of our citizens. 
The Federal Government for many years 
has given financial aid to special aspects of 
education, such as vocational education, and 
to institutions for special groups, such as 
Howard University. It has become in- 
creasingly evident that Federal support of a 
more general character is needed if satisfac- 
tory educational opportunities are to be made 
available for all. The Nation cannot afford 
to waste human potentialities, as we are 
now doing, by failing to provide adequate 
elementary and secondary education for mil- 
lions of children and by failing to help hun- 
dreds of thousands of young people who 
could benefit from higher education. 

The importance of this need requires that 



we provide substantial Federal assistance to 
States for general educational purposes and 
for certain other important programs in this 
field. 

To progress toward these objectives, this 
Budget includes expenditures for education 
and general research (not including large 
amounts in veterans, national defense, and 
other categories) of 434 million dollars in 
the fiscal year 1951, compared with 125 mil- 
lion dollars in 1950. More than three- 
fourths is for grants to States. The increase 
is entirely accounted for by the additional 
expenditures in 195 1 resulting from the new 
legislation I am recommending. This leg- 
islation will entail a further moderate in- 
crease in later years. 

Promotion of education — Elementary and 
secondary, — ^The high mobility that charac- 
terizes our people means that no State is 
immune to the effects of ignorance and il- 
literacy in other States. The welfare of the 
Nation as a whole demands that the present 
educational inequalities be reduced. Educa- 
tional inequalities are primarily due to dif- 
ferences in the financal resources of States 
and localities. Income per capita in some 
States is less than half as great as in others. 
The States with the lowest incomes have the 
greatest proportion of school-age children 
and are unable to finance a fair educational 
opportunity even with greater effort in terms 
of tax burden. 

School enrollments in practically every 
State have risen recently and will continue 
to rise owing to the increased birth rate. 
Millions of our children are now taught in 
overcrowded classrooms. For others edu- 
cation is provided only on a part-time basis. 
At the very time when we need more and 
better teachers, schools must still employ 
tens of thousands whose qualifications do 
not meet the standards necessary to provide 
a satisfactory quality of teaching. Because 



82 



Harry S. Truman, ig$o 



Jan. 9 [9] 



salaries are generally inadequate, too few 
capable young people are preparing to enter 
the teaching profession. 

For these reasons I urge the Congress to 
complete legislative action to permit the Fed- 
eral Government to aid the States in support 
of the maintenance and operation costs of 
a basic minimum program of elementary 
and secondary education. The Budget pro- 
vides for beginning this aid in the fiscal 
year 195 i. 

There is a shortage of school buildings 
in many parts of the country due to the 
wartime deferment of construction and the 
increase in the school-age population. In 
many localities the need for facilities results 
from the sudden and substantial impact of 



Federal activities. I recommend that the 
Congress enact legislation providing for 
grants to States for surveys of their need 
for facilities and their resources, and grants 
for the construction of buildings in those 
particular areas where Federal activities have 
been responsible for increased enrollments. 

For a number of years several Federal 
agencies, under separate authorizations, have 
been helping to finance the education of chil- 
dren living on Federal property and in com- 
munities affected by Federal activities. I 
recommend that the Congress enact general 
legislation to establish a single program for 
all Federal agencies. 

Promotion of education — Higher educa- 
tion, — ^Large numbers of young people and 



Education anu General Research 



[ Fiscal years. 



In millions ] 

Expenditures 



1949 
actual 



ipso 
estimated 



I9SI 
estimated 



"New ohligational 
authority for 1951 
Appropria- 
tions 



70 



125 



434 



U55 



Other 



Program or agency 
Promotion of education: 
Present programs: 

Office of Education (Federal Security Agency) . . 
General Services Administration and Interior. . 
Proposed legislation: 
Elementary and secondary education: 

General aid for operating expenses 

Surveys and emergency construction 

Children on Federal property and in emer- 
gency areas 

Higher education: General assistance to college 

students 

Educational aid to special groups 

Library and museum services 

General purpose research: 
Department of Commerce: 

Seventeenth decennial census 

Odier Census Bureau programs 

National Bureau of Standards 

National Science Foundation (proposed legisla- 
tion) 

Other agencies 



Total 

*Less than one-half million dollars. 
This Budget also includes 2 million dollars of appropriations to liquidate prior year contract authori- 
zations. 



$33 


$34 


$37 


$38 




6 


8 


C) 

290 

22 

7 
I 


C) 

300 

45 

7 

I 




3 


7 


12 


% 


$1 


9 


II 


12 


12 




2 


45 


33 


30 




6 


7 


7 


7 




10 


12 


II 


10 
I 


6 


I 


I 


C) 







83 



[9] Jan. 9 



Public Papers of the Presidents 



adults wish to continue their education be- 
yond high school in order to prepare for en- 
trance to professional schools, to receive addi- 
tional technical or vocational training or to 
round out their general education. For 
many of our people, postsecondary education 
on a part-time or full-time basis, provided 
in institutions located v^ithin commuting dis- 
tance of home, would meet their needs at low 
cost. Several of the States are now develop- 
ing community institutions for this pur- 
pose. I have asked the Federal Security 
Administrator to make a comprehensive 
study of this development in order to deter- 
mine whether the Federal Government 
might appropriately take any action to en- 
courage the States and localities to estab- 
lish and expand "community colleges." 

Primarily because of low family incomes 
and of the high costs involved, more than 
half of our young people who could benefit 
from a college education are now unable to 
attend. This failure to develop to the fullest 
extent the capacities of our young people 
is a matter of national concern. As a step 
toward correcting this situation, I shall trans- 
mit to the Congress a legislative proposal to 
authorize a limited Federal program to assist 
capable youth who could not otherwise do so 
to pursue their desired fields of study at the 
institutions of their choice. 

This Budget includes i million dollars as a 
tentative estimate of appropriations needed 
in the fiscal year 1951 to establish the re- 
quired organization and to initiate the pro- 
gram. Assistance to students would begin 
in the fiscal year 1952. 

National Science Foundation, — ^The Gov- 
ernment is investing hundreds of millions of 
dollars in research — primarily in applied re- 
search in the military, atomic energy, and 
health fields. We must consider, however, 
not only the ways in which the great reser- 
voir of scientific knowledge already at our 
disposal can best be utilized, but also the 



best paths to follow for the discovery of fur- 
ther basic knowledge. To this end, we 
urgently need a National Science Foundation 
to stimulate basic research and to assure an 
effective balance among the Federal research 
programs. By developing a national research 
policy and by formulating a truly national 
research budget it should be possible to relate 
the activities of public and private institu- 
tions in a concerted effort to advance the 
frontiers of knowledge. The Budget pro- 
vides 500 thousand dollars for the initial 
administrative expenses of the proposed Na- 
tional Science Foundation, in the expectation 
that the Congress will enact legislation, al- 
ready passed by the Senate, to establish it. 

Seventeenth decennial census, — ^The seven- 
teenth decennial census of population, hous- 
ing, and agriculture, to be taken this year, 
will provide basic data essential to important 
decisions by businessmen, governments, and 
other groups throughout the Nation. Ex- 
penditures for the census, estimated at 45 
million dollars in 1950, will drop to 33 mil- 
lion dollars in 195 1, and continue to decrease 
in succeeding years as tabulation and publi- 
cation of the results are completed. 

Agriculture and Agricultural 
Resources 

American agriculture is in a period of 
transition from the peak production require- 
ments of the war and immediate postwar 
years to the normal requirements of a peace- 
time economy. During the war, every effort 
was made to increase agricultural produc- 
tion to meet the needs of our war economy 
and of our allies. In some cases desirable 
long-run goals for conservation of soil 
resources were deferred in the effort to 
increase production and to minimize the 
manpower requirements in agriculture. 
War dislocations and crop shortages abroad 
created an abnormal export demand for food 



84 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Agriculture and Agricultural Resources 
[ Fiscal years. In millions ] 

Expenditures 



1949 
Program or agency actual 

Loan and investment programs: 
Department of Agriculture: 

Commodity Credit Corporation $1, 600 



Farmers' Home Administration 

Rural Electrification Administration 

Other programs 

Other agencies 

Other financial aids: 

Department of Agriculture: 

Conservation and use (including acreage allot- 
ments and marketing quotas) 

Removal of surplus agricultural commodities. . 

Sugar Act 

International Wheat Agreement 

Other agencies 

Agricultural land and water resources 

Other development and improvement of agriculture: 

Present programs 

Commodity Exchange Authority (proposed legis- 
lation) 



123 

305 

-63 



182 
75 
56 

— 2 
59 

177 



1950 
estimated 



.533 

26 

362 

6 

3 



285 



C) 



63 
82 

64 



161 



I95I 

estimated 



$952 

26 

436 

— I 



314 
114 

69 
76 

68 

149 



l^ew obligational 
authority for 1951 
Appropria- 
tions 



$35 
10 
10 
2 



319 

no 

68 

82 



Other 



$110 
450 



68 



169 



Total 2,512 2, 671 2, 206 875 580 

^ Additional borrowing authority of 2 billion dollars is recommended, to become available in the fiscal 
year 1950. 

^ Less than one-half million dollars. 



grains and a few other farm products, fi- 
nanced largely by United States foreign re- 
lief and aid programs. In the next few 
years, this abnormal demand can be ex- 
pected to adjust to a more normal level and 
distribution pattern for world trade. 

Although this transition from war to 
peacetime needs has caused a decline in farm 
prices and a loss in farm income, the opera- 
tion of Government price supports has 
served to cushion the decline and has been 
a major factor in preventing a serious post- 
war recession in the economy as a whole. 
The resulting benefits to workers and em- 
ployers, as well as to farmers, have been 
many times the outlay of Federal funds. As 
the necessary adjustments in agriculture are 
completed, we should look forward to a re- 



duction in budgetary expenditures for this 
purpose. The need for food and fiber prod- 
ucts will continue to expand as our national 
income and population increase. Produc- 
tion on existing land, however, must be 
gradually shifted from the grains and cotton 
to livestock and dairy production, permit- 
ting marginal lands, whose soil is in danger 
of loss from erosion of wind and water, to be 
put back into pasture and soil-conserving 
crops. It is important that Government 
programs facilitate these adjustments within 
agriculture as well as between agriculture 
and the rest of the economy. 

Federal agricultural programs, in addition 
to promoting adjustments in agriculture and 
stimulating conservation of soil resources, 
are designed to improve the efficiency of 



85 



[g] Jan. 9 



Public Papers of the Presidents 



farm production, to provide low-income 
farmers an opportunity to improve their 
economic status, to assure farmers generally 
a reasonable stability in farm income, and to 
improve the level of rural living. 

Total Federal expenditures for agriculture 
and agricultural resources increased from 
2.5 billion dollars in 1949 to an estimated 
2.7 billion dollars in 1950. Both years reflect 
the operation of price-support programs as 
farm prices declined. A decrease of 465 
million dollars is expected in 195 1, resulting 
from smaller oudays on price supports as 
acreage allotments and marketing quotas 
serve to reduce production of some 1950 
crops, particularly cotton and corn. 

Price support, — ^Net outlays of the Com- 
modity Credit Corporation amounted to 1.6 
billion dollars in 1949. This was the first 
year since before the war that mandatory 
price supports have resulted in large cash 
expenditures and the accumulation of loans 
and inventories in the hands of the Corpora- 
tion. Expenditures in 1950, estimated at 1.5 
billion dollars, will be largely for corn and 
cotton, with smaller outlays for peanuts, 
rice, tobacco, milk and milk products, pota- 
toes, beans, cottonseed, linseed oil, and vari- 
ous other products. Approximately 90 mil- 
lion dollars of the expenditures will be for 
construction of new grain-storage facilities. 
In 1 95 1, estimated Commodity Credit Cor- 
poration expenditures decline to 952 million 
dollars because of the expected effects of 
acreage allotments and marketing quotas on 
the 1950 crops. In later years, price-support 
expenditures should decline further as pro- 
duction is adjusted to normal demand. 

Estimates for price-support expenditures 
are, of course, highly tentative, since the 
actual expenditures depend upon many fac- 
tors which cannot be accurately forecast, 
such as the volume of exports, the rate of 
domestic consumption, and the influence of 
insects and weather conditions on yields. 



The operation of price supports has re- 
sulted in the accumulation of large inven- 
tories, particularly of cotton, wheat, and 
corn. These commodity inventories repre- 
sent assets which provide insurance against 
possible crop shortages in future years. It is 
estimated that the financial requirements of 
the Commodity Credit Corporation in the 
fiscal year 1951 may exceed its present bor- 
rowing authorization. I recommend that 
the Corporation be given an additional bor- 
rowing authority of 2 billion dollars, to be 
available beginning in 1950. 

Farmers' Home Administration, — ^The 
Farmers' Home Administration provides 
management assistance to low-income farm- 
ers, and makes loans for farm enlargement 
and development, production and subsist- 
ence, water facilities, homesteads, and farm 
housing. (Farm housing loans financed 
under the borrowing authorization provided 
in the Housing Act of 1949 are classified 
under housing and community develop- 
ment.) The apparent decline in expendi- 
tures for the Farmers' Home Administra- 
tion in 1950 and 195 1 compared with 1949 
is due to a shift in financing provisions. In 
1949, loans were financed from appropriated 
funds, and all loans were shown as expendi- 
tures, with collections on old loans going 
directly into miscellaneous receipts of the 
Treasury. In 1950 and 195 1, most of the 
loan programs will be financed by a borrow- 
ing authorization, and the expenditure figure 
will reflect loans less collections. 

Rural electrification and rural tele- 
phones, — On June 30, 1949, approximately 
78 percent of all farms were electrified. As 
coverage is gradually extended to the re- 
maining areas. Rural Electrification Admin- 
istration loans for electrification will decline. 
Beginning in the fiscal year 1950, the Rural 
Electrification Administration will also 
make loans to rural telephone cooperatives 
and other independent telephone companies 



86 



Harry S. Truman, ig^o 



Jan. 9 [9] 



under recently enacted legislation. Loans 
for this purpose are expected to increase in 
195 1. Net loan expenditures of the Rural 
Electrification Administration are estimated 
to be 427 million dollars in 195 1, compared 
with 355 million dollars in 1950 and 299 mil- 
lion dollars in 1949. I recommend that the 
Rural Electrification Administration be 
given new loan authority for the fiscal year 
1 95 1 amounting to 450 million dollars, of 
which 50 million dollars will be available for 
the rural telephone loan program. 

Conservation, — ^The Soil Conservation 
Service provides technical advice and assist- 
ance to farmers in establishing a sound pro- 
gram of farm management to insure ade- 
quate protection and development of soil 
resources. Conservation practices are also 
encouraged through the agricultural con- 
servation payments program carried out by 
the Production and Marketing Administra- 
tion. By the end of the fiscal year 1951, 
about 90 percent of the farms of the country 
will be in organized soil conservation dis- 
tricts. Progress is being made in the prep- 
aration and application of desirable farm 
management plans for the adequate protec- 
tion of our soil resources, but still greater 
emphasis will need to be given in future 
years to soil and water conservation, includ- 
ing the Department's upstream and on-the- 
farm flood-control program, to reduce silta- 
tion in the downstream areas and to enhance 
the value of projects constructed by the 
Bureau of Reclamation and the Corps of 
Engineers. 

Expenditures for the Soil Conservation 
Service and for flood-control work of the 
Department of Agriculture are expected to 
increase from 64 million dollars in 1950 to 
68 million dollars in 1951. Expenditures 
for the conservation and use program and 
for administering acreage allotments and 
marketing quotas are estimated to be 314 
million dollars in 195 1 compared with 285 



million dollars in 1950 and 182 million dol- 
lars in 1949. I am recommending that the 
advance authorization for the conservation 
and use program in the 1951 crop year, 
which will largely determine expenditures 
in the fiscal year 1952, be maintained at the 
1950 crop year level of 285 million dollars. 

Other financial aids. — ^Under the terms of 
the International Wheat Agreement, the 
United States will export 168 million bushels 
of wheat each year for 4 years at a price not 
in excess of |i.8o a bushel. In return, im- 
porting countries have agreed to buy the 
wheat at not less than certain specified min- 
imum prices. In the first year, the effective 
export price for United States wheat is $1.80. 
It is estimated that the Commodity Credit 
Corporation, through which the program is 
financed, will spend 82 million dollars in 
the fiscal year 1950 to bridge the gap be- 
tween the $1.80 export price and the higher 
domestic market price. In 1951, such costs 
are estimated at y6 million dollars. The 
Corporation is to be reimbursed for each 
year's cost of the Wheat Agreement from ap- 
propriated funds. In 195 1, an appropria- 
tion of 82 million dollars is recommended to 
reimburse the Corporation for the cost of 
the Wheat Agreement in the fiscal year 1950. 

Additional financial aid is provided for 
farmers through the Sugar Act of 1948 and 
through the permanent appropriation for 
removal of surplus agricultural commodities. 
Expenditures under the Sugar Act depend 
on the volume of domestic sugar production 
for which sugar growers receive payments 
at the rates determined in the legislation. 
It is estimated that expenditures under the 
Sugar Act will be 69 million dollars in 1951. 
The permanent appropriation for removal of 
surplus agricultural commodities, established 
in 1935, provides a fund each year equal to 
30 percent of customs duties. In 195 1, it is 
estimated that no million dollars will be 
available in this fund. 

87 



[9] Jan. 9 



Public Papers of the Presidents 



Other development and improvement of 
agriculture. — Included in this category are 
the continuing basic services for agriculture, 
such as research on crop varieties, livestock 
and poultry, and the production and mar- 
keting of farm products; control and erad- 
ication of insects and plant and animal dis- 
eases; payments to States for experiment 
stations and cooperative extension work; and 
the general overhead expenses of the De- 
partment. For 1 95 1, I recommend legisla- 
tion to strengthen the regulation of commod- 



ity exchanges by the Commodity Exchange 
Authority. 

Natural Resources 

This Nation has learned in recent years 
what it means to have limited natural re- 
sources. Our soil, forests, water, and min- 
erals have been drawn upon prodigiously to 
support two major wars and the rapid eco- 
nomic growth of our country. If we are to 
continue to expand production and employ- 



Natural Resources 



[ Fiscal years. 



Program or agency 
Atomic energy: 

Atomic Energy Commission 

Other agencies 

Land and water resources: 

Corps of Engineers (Army, civil functions) 

Department of the Interior: 

Bureau of Reclamation 

Bonneville Povtrer Administration and South- 
western and Southeastern power systems .... 
Research in utilization of salt water (proposed 

legislation) 

Other 

Tennessee Valley Authority (net) 

Department of State and other 

Forest resources: 

Forest Service and other (Agriculture) 

Department of the Interior 

Mineral resources: 

Bureau of Mines and other Interior 

Department of the Navy and other 

General resources surveys (Interior) 

Fish and wildlife resources (Interior and other) .... 
Recreational use of resources: 

Department of the Interior 

Baltimore- Washington Parkway (proposed legis- 
lation) 



In millions ] 

Expenditures 



"New obligational 
authority for ig^i 

^949 ^950 1951 Appropria- 

actual estimated estimated tions 



$621 
I 

401 

240 

29 



32 

27 

4 

63 
3 

29 
13 
13 
18 

19 



$673 

o 

486 

334 

42 



43 

52 

7 

76 
3 

37 
18 
16 
28 

29 



1,845 



$817 

563 

398 

55 



96 
13 

82 
2 

36 

20 
20 
29 

38 



2, 218 



$266 

557 

355 

37 

I 

47 

108 

9 

84 
I 

35 
15 
20 
26 

31 

3 

'i>594 



Other 

$334 



28 



C) 



Total 1,512 I, »45 2, 2i« "1,594 37o 

^ Less than one-half million dollars. 

^ This Budget also includes 500 million dollars of appropriations to liquidate prior year contract authori 



88 



Harry S. Truman, ig^o 



Jan. 9 [9] 



ment we must use our remaining resources 
with the greatest possible effectiveness, fol- 
lowing sustained-yield principles, develop- 
ing resources as yet unused, and restoring 
where possible the resources we have 
depleted. 

A large share of the responsibility for such 
action falls upon the Federal Government, 
with respect to both resources on public 
lands and resources in private ownership. 
Atomic energy development depends upon 
our pressing ahead with the present Federal 
program on a broad scale. Continued eco- 
nomic growth in large areas of our country 
depends upon steady progress in Federal 
investment for flood control, reclamation, 
electric power, and related facilities. The 
wisdom with which we utilize our mineral 
resources will influence our economic 
strength and security for generations to come. 
Continued public investment in these areas is 
a prerequisite in many fields to the expan- 
sion of the private investment which we want 
to encourage. 

The dollars which the Federal Govern- 
ment spends on these programs are largely 
investment dollars. In many cases, such as 
irrigation, power projects, and the manage- 
ment and improvement of public lands and 
forests, the activities are wholly or partially 
self-liquidating. In all cases, economic 
benefits will accrue to the Nation for many 
years. 

The 1 95 1 Budget provides for total ex- 
penditures of 2.2 billion dollars in this area, 
an increase of 373 million dollars from 
1950. Over one-third of the total and of the 
increase is attributable to expenditures for 
atomic energy. The balance represents pri- 
marily the requirements of projects under 
way in the fields of flood control and recla- 
mation. This Budget provides for no new 
projects in these areas. Despite the large 
number of highly meritorious projects which 



have already been authorized for construc- 
- tion, we should not at this time add to the 
present high level of commitments. This 
policy is necessary both because of our over- 
all fiscal position and in order to provide 
the greatest possible measure of stability, un- 
der present economic conditions, in the rate 
of Federal public works expenditures. 

Atomic energy, — The United States is 
seeking both to develop atomic energy for 
national defense purposes and to realize 
the great promise in its use for industrial 
and other peacetime purposes. Our atomic 
energy development program is a large ven- 
ture in diverse fields — scientific research, 
medicine, engineering, industry — and will 
continue to require substantial outlays in 
the next few years. 

The 195 1 expenditures include increased 
amounts for the production of fissionable 
materials and weapons, and for the advance- 
ment of the science and technology of atomic 
energy, including accelerated construction of 
new facilities and development of new types 
of nuclear reactors. It is principally through 
the development of new reactors to produce 
fissionable materials and radioisotopes, gen- 
erate power, and propel ships and aircraft, 
that the Atomic Energy Commission expects 
to evolve means of utilizing for peaceful 
purposes the energy released by nuclear 
fission. 

Land and water resources, — ^We have 
learned a great deal in recent years about the 
extensive benefits which can be achieved by 
proper development of our land and water 
resources — ^including navigation, flood con- 
trol, reclamation, power development, soil 
and forest conservation, preservation of fish 
and wildlife, and recreation. In the interest 
of sounder and more efficient programs in 
later years, emphasis in this Budget is placed 
on more thorough investigation and ad- 
vance planning, and on assembling more 



41-355—^65 



89 



[9] Jan. 9 



Public Papers of the Presidents 



complete basic data. However, the frame- 
work of Federal legislation and administra- 
tive organization under which we are 
carrying on development programs is in 
many respects inadequate and obsolete. 

In order to obtain a thorough review of 
the present basic legislation, I have created 
by recent Executive Order a Water Resources 
Policy Commission, which will make recom- 
mendations later this year with respect to 
the broad policies which should guide Fed- 
eral participation in the development, con- 
servation, and use of water resources — ^both 
upstream and downstream — and closely re- 
lated land-use activities. On the basis of 
these recommendations, I expect that it will 
be possible to propose up-to-date and effec- 
tive policies for the Federal, State, local and 
private efforts which are needed to make 
proper use of water resources throughout 
the country. Some changes in present Fed- 
eral legislation can and should be made at 
this session of the Congress, but major 
changes should be deferred until the Com- 
mission's recommendations are available. 

We also need to find more effective ar- 
rangements for administering Federal laws 
and programs concerning land and water- 
resource development. I have already rec- 
ommended that the Congress authorize the 
consolidation of a number of Federal activ- 
ities in the Pacific Northwest into a Colum- 
bia Valley Administration, and provide for 
its proper integration with other Federal 
agencies and with State and local respon- 
sibilities. In other areas also we should 
be alert to the opportunities for better 
administrative arrangements, building on 
successful experience in the Tennessee Val- 
ley and elsewhere, and adapting organiza- 
tional patterns to the particular circum- 
stances of different regions. 

The activities of the Bureau of Reclama- 
tion and the flood-control program of the 
Corps of Engineers, involving the construc- 



tion of dams, power facilities, canals, chan- 
nels, and levees, will be limited in 195 1 to 
continuation of work on projects started 
in prior years. Bureau of Reclamation proj- 
ects now under way will require an expendi- 
ture increase of 64 million dollars in 1951. 
Expenditures required in 195 1 to continue 
going work of the Corps of Engineers will in- 
crease by 77 million dollars over the 1950 
total. 

The expenditures by the Corps of Engi- 
neers and Bureau of Reclamation will result 
in materially increased power facilities in 
the next few years. In addition, continuing 
progress on the existing programs of the 
Bonneville and Southwestern power systems 
will result in a further increase in transmis- 
sion facilities. An increase of 44 million 
dollars is recommended for the Tennessee 
Valley development, notably for expansion 
of power facilities to meet the growing needs 
of the atomic energy program. 

Experience in recent years has shown that 
it may not be possible to meet the shortages 
of water, which are a threat in some areas, 
through our extensive water-resource pro- 
grams. I recommend, therefore, that the 
Congress enact legislation authorizing the 
initiation of research to find means for trans- 
forming salt water into fresh water in large 
volume at economical costs. 

Public lands and national forests. — Over 
many years, our policy with respect to public 
lands and forests, now comprising over 
900,000,000 acres, has gradually been broad- 
ened from one of disposal to one of manage- 
ment and conservation. The range, forest, 
and mineral resources of these lands have 
considerable commercial value and bring in 
substantial receipts; in addition they have 
important watershed, wildlife, and recrea- 
tional value. In some respects, we have a 
long way to go before we shall be managing 
and conserving these resources to achieve 
their full use and preservation. We should 



90 



Harry S. Truman, igp 



Jan. 9 [9] 



plan to expand our rehabilitation, protection, 
and management of these resources in the 
years ahead; the 195 1 Budget includes in- 
creased funds for these purposes. 

Mineral resources, — The Bureau of Mines 
and the Geological Survey are carrying on 
important investigations and research in 
order to ascertain the extent of our mineral 
resources and the best means of conserving 
and using them. In v\&w of the limited 
domestic supplies of many minerals, there is 
real need for increased exploration and con- 
servation of strategic and critical minerals. 

Through laboratory research and develop- 
mental vi^ork, including operation of demon- 
stration plants, the Government has shown 
that some of our liquid fuel demands can be 
met from synthetic fuels produced from oil 
shale and coal. This Budget includes funds 
for a continuation of efforts to improve syn- 
thetic liquid fuels, and to narrow^ the cost 
differential betv^een synthetic and natural 
petroleum products. 

Use of recreational resources. — During 
the past travel season there v^ere 32,000,000 
visitors to the 181 national park areas. This 
number of visitors is the highest in the his- 
tory of the National Park Service; it is dou- 
ble the number before the w^ar. This heavy 
increase in the use of the park areas has 
enlarged the requirements for their man- 
agement and protection. The increase of 
9 million dollars in the 1951 Budget for the 
Park Service v^ill provide for additional 
management and maintenance costs and for 
some urgently needed construction. 

Alas\an resources. — Alaska is a land of 
large natural resources — forests, fish and 
w^ildlife, minerals, land, and w^ater — v^hich 
must be developed in order for the area to 
make its contribution to the security and 
economy of the Nation. The 195 1 pro- 
grams discussed above include 23 million 
dollars for the development of natural re- 
sources in Alaska. Developmental expendi- 



tures in Alaska under other functions — in 
particular national defense, transportation, 
and social welfare — will amount to approxi- 
mately 162 million dollars. 

Indian land resources, — Large areas of 
Indian lands are rich in timber, oil, gas, and 
other minerals, the conservation and devel- 
opment of which should be related to pro- 
grams affecting similar lands. As part of 
our general program for protecting their 
rights and for helping the Indians to become 
self-reliant citizens, funds are included in 
this Budget for initiating the long-range pro- 
gram for the rehabilitation of the Navajo 
and Hopi Indians in Arizona and New Mex- 
ico. While the greater portion of the 
amount recommended is for essential con- 
struction of educational and health facilities 
(classified in social welfare, health, and secu- 
rity), provision is made also for expanded 
conservation and development of the re- 
sources of the reservations. Funds are also 
included for some expansion in conservation 
activities on Indian lands in other areas, as 
well as for additional health, education, and 
other benefits to the Indian population. 

Transportation and Communication 

Efficient transportation and communica- 
tion services play a major role in promoting 
the economic growth of our country and in 
assuring our national security. Throughout 
our history, the Federal Government has 
traditionally supplemented private enter- 
prise in this field, wherever necessary to as- 
sure adequate services at reasonable cost. 
To this end, the Government provides basic 
facilities; it regulates economic and safety 
aspects of commercial operations; it sub- 
sidizes essential services which could not sur- 
vive without Government aid. In the fiscal 
year 195 1, an estimated 1.7 billion dollars 
will be spent for these activities, a decline of 
212 million dollars from 1950. This as- 



91 



[9] Jan. 9 



Public Papers of the Presidents 



sumes a reduction of the postal deficit to a 
reasonable level, through enactment of 
postal rate increases. 

Most of the Federal transportation ex- 
penditures are for the provision and opera- 
tion of physical facilities. Direct Federal 
expenditures for aviation facilities; marine 
navigation aids, v^aterway improvements, 
and roads will amount to about 600 million 
dollars in 195 1. In addition, grants to State 
and local governments for the construction 
of highw^ays and airports will account for 
514 million dollars. Although these pro- 
grams make important contributions to the 
development of our economy, over-all budg- 
etary considerations make it impossible to 
proceed with them as rapidly as we should 
like. The 1951 Budget recommendations 
have been held as close to the 1950 level as 
program commitments would allow. 

The long-term interests of the general tax- 
payer, as well as the users of transportation, 
will best be served by the development of a 
balanced transportation system, substantially 
independent of Government support. It is 
essential that the various promotional and 
regulatory activities of the Government fit 
together into a unified transportation pro- 
gram aimed at achieving that goal. At my 
request, the Secretary of Commerce recendy 
prepared a report outlining the major policy 
issues which need to be resolved in order to 
assure such a program. This report is now 
being reviewed within the executive branch, 
and I shall later transmit recommendations 
for any legislation or other action that may 
prove appropriate. 

Merchant marine, — ^Under the Merchant 
Marine Act of 1936, the Federal Government 
provides both construction and operating 
subsidies to the maritime industry, intended 
to oflset the competitive effects of lower 
foreign costs. In the fiscal year 195 1, oper- 
ating subsidies alone are estimated to accrue 



in the amount of 63 million dollars, about 
five times the average annual level before the 
war. Shipbuilding subsidies have recendy 
averaged close to 45 percent of the domestic 
cost of vessel construction, exclusive of na- 
tional defense features financed entirely by 
the Government. 

I am seriously concerned by the increasing 
cost of these existing subsidies and by the 
potential cost of new subsidies now being 
advocated. Our national security requires 
an efficient nucleus of merchant shipping and 
shipbuilding, adequate to permit such ex- 
pansion as may be required by a future emer- 
gency. However, to limit the burden on the 
taxpayer, this subsidy program should be 
held to the minimum level that will satisfy 
national defense needs. In determining this 
level, full account must be taken of the avail- 
ability of vessels from friendly nations in the 
event of an emergency. The existence of the 
North Adantic Treaty provides a framework 
within which joint international planning 
of shipping mobilization may proceed. 

The entire subject of Government aid to 
the merchant marine is now under active 
study by the executive agencies concerned. 
Until such studies are completed, we should 
proceed cautiously with existing subsidy pro- 
grams, and should avoid commitments for 
any major new programs. The Budget for 
195 1 has been developed on that basis. 

Expenditure increases in 195 1 for ship 
construction and for operating subsidies will 
be partially oflset by reductions in other 
Maritime Commission activities. The mari- 
time training program is being reduced in 
size, and consolidated at three locations. 
Authority for ship chartering, scheduled to 
expire on June 30, 1950, does not now appear 
to be required beyond that date. Expendi- 
tures will also be lower for the liquidation 
of wartime obligations. 

Navigation aids and facilities, — ^The safety 



92 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Transportation and Communication 



[ Fiscal years. 



Program or agency 
Promotion of merchant marine: 

Maritime Commission 

Inland Waterways Corporation: 

Present programs 

Proposed legislation 

Provision of navigation aids and facilities: 

Panama Canal 

Corps of Engineers: 

Present programs 

St. Lawrence seaway (proposed legislation) 

Coast Guard 

Interior 

Promotion of aviation: 

Civil Aeronautics Administration: 

Present programs 

Alaska airports (proposed legislation) 

Provision of highways: 
Bureau of Public Roads: 

Present programs 

Proposed legislation 

Alaska roads (Interior) 

Forest roads and trails (Agriculture) 

Regulation of transportation 

Other services to transportation: 

Reconstruction Finance Corporation 

Coast and Geodetic Survey 

Alaska Railroad 

Treasury Department 

Postal service deficit: 

Present programs 

Proposed legislation 

Regulation of communication 

Alaska Communication System 



In millions ] 

Expenditures 



"New obligational 
authority for ig^i 

ig4g igso igsi Appropria- 



actual 


estimated 


estimated 


tions 


Other 


$122 


$161 


$222 


$135 


$70 


2 


I 


3 


3 




17 


20 


20 


^9 




160 


2X2 


243 
4 


242 
6 




132 


158 


181 


187 




C) 


I 


3 






143 


187 

I 


226 
4 


133 


70 


414 


490 


504 










3 


3 


524 


16 


23 


23 


16 


9 


23 


2 








15 


15 


16 


16 




—3 


2 


6 






10 


12 


12 


12 




33 


30 


41 


28 




Q) 





{') 


I 




530 


569 


555 
—395 


555 
-395 




7 


7 


7 


7 




2 


3 


4 


6 





I, 622 



1,894 



1,682 



973 



673 



Total 

^Less than one-half million dollars. 

^ This Budget also includes 591 million dollars of appropriations to liquidate prior year contract author- 
izations. 



of surface and air operations at sea requires 
the navigational aids, rescue stations, and 
other services provided by the Coast Guard. 
Expenditures for these activities are esti- 
mated to increase from 158 million dollars 
in 1950 to 181 million dollars in 195 1. This 



increase is largely for the replacement of 
over-age aircraft, and for more adequate 
maintenance of existing facilities. 

The 1 95 1 recommendations do not pro- 
vide for starting construction on any new 
river and harbor projects of the Corps of 



93 



[9] Jan. 9 



Public Papers of the Presidents 



Engineers. Projects already under way will, 
however, require an increase in expenditures 
from 212 million dollars in the fiscal year 
1950 to 243 million dollars in 195 1, and a 
further increase in 1952. 

I repeat most emphatically my previous 
recommendations for approval of the Saint 
Lawrence waterway and power project. 
Authorization of the seaway, with its related 
power facilities, is a matter of urgency for 
our peacetime industry and our national 
security. In particular, each succeeding year 
reduces further our domestic reserves of iron 
ore, and increases correspondingly the im- 
portance of the seaway as a means of eco- 
nomical access to the proven ore deposits 
in Quebec and Labrador. 

Aviation, — The Federal Government pro- 
vides extensive aid, both direct and indirect, 
to civil aviation. This assistance, which is 
consistent with our traditional policy of pro- 
moting new forms of transportation, has 
made possible a spectacular development of 
air transport services, especially during the 
past decade. Although continued aid is 
required for the present, the industry should 
be expected to become increasingly self- 
supporting in the near future. 

At present, direct financial assistance to 
the air lines is provided through air-mail 
payments, which are set generally at levels 
adequate to cover deficiencies in the carriers' 
commercial revenues. Subsidy is thus 
merged with the fair compensation for 
carrying mail, making it difEcult to evaluate 
the cost of this aid in relation to its benefits. 
The recent rise in total air-mail payments — 
to an estimated level of about 125 million 
dollars in 1950 — has made it increasingly 
important that the subsidy element be sepa- 
rately identified. I recommend, therefore, 
the immediate enactment of legislation to au- 
thorize the separation of subsidy payments 
from mail compensation. Such subsidies 
should be paid from funds appropriated to 



the Civil Aeronautics Board specifically for 
that purpose. 

The standard by which subsidy rates are 
determined under existing legislation may 
itself merit review in the light of the indus- 
try's present stage of development. Setting 
subsidies on the basis of the carriers' revenue 
needs may weaken the incentives for man- 
agerial economy, thereby increasing the dif- 
ficulty of effective regulation by the Civil 
Aeronautics Board. While a considerable 
gain in efficiency has been realized by the 
air Hnes since the end of the war, there are 
undoubtedly important opportunities for 
further improvement. The 1951 Budget 
will permit the Civil Aeronautics Board to 
conduct more intensive investigations of air- 
line efficiency, and to develop operating cost 
standards. This should assist the Board in 
shaping its subsidy policies so as to retain, 
to the maximum extent possible, the normal 
business incentives for economy. 

The continued growth of air transporta- 
tion depends upon modernization of our air- 
way facilities to permit safe and regular 
flights under all weather conditions. Ex- 
penditures for the development, installation, 
and operation of such facilities are estimated 
at 136 million dollars in the fiscal year 1951, 
39 million dollars above 1950. Other ac- 
tivities of the Civil Aeronautics Adminis- 
tration — including safety regulation and 
airport grants — ^will require expenditures of 
93 million dollars in 195 1, 3 million dollars 
higher than in 1950. 

Highways. — Major development of our 
highway system is required to overcome 
obsolescence and to handle safely and effi- 
ciently the steadily increasing traflSc loads. 
This is primarily the responsibility of States, 
counties, and municipalities. The Federal 
Government must, however, continue pro- 
viding financial assistance to the extent 
necessary to assure a basic system of na- 
tional roads, built to uniformly adequate 



94 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Standards. Under existing legislation, the 
Bureau of Public Roads is expected to spend 
504 million dollars for highway improve- 
ment in 1 95 1, mainly in the form of grants 
to States. Apart from the emergency re- 
lief programs during the depression, this will 
be the highest annual level of Federal high- 
way expenditures to date. 

All of the Federal-aid funds thus far au- 
thorized have been apportioned to the States, 
and new authorizing legislation is therefore 
required during the present session of the 
Congress. I recommend that such legisla- 
tion provide an annual Federal-aid authori- 
zation for the next 2 years of 500 million 
dollars, an increase of 50 million dollars 
above the current level. Within this total, 
increased emphasis should be placed upon 
the Interstate Highway System, a limited 
network of routes which is of greatest na- 
tional importance to peacetime traffic needs 
as well as to our national defense. The 
recommended shift in emphasis, and increase 
in program level, should permit a satisfac- 
tory rate of improvement for this System. 

Postal service, — ^Postal rates have not kept 
pace with increasing costs and, as a result, the 
postal deficit has reached excessive propor- 
tions. Since 1939, the average expense per 
postal transaction has increased by 67 per- 
cent, owing mainly to higher wage and 
transportation costs; in contrast, average 
revenue has increased by only 32 percent. 
On the basis of existing postal rates, the 
deficit for 195 1 is estimated at 555 million 
dollars. Cases now pending before the reg- 
ulatory commissions may result in higher 
payments for transportation, and hence may 
correspondingly increase the deficit. 

The Postmaster General is exploring fully 
all opportunities for reducing the cost of the 
postal operation. Modernization of the mo- 
tor vehicle service, and the mechanization 
of mail handling, are among the items re- 
ceiving particular attention. I am confident 



that the steps now being taken will in the 
long run help to assure the maximum effi- 
ciency of the postal operation. However, the 
potential savings, if present service stand- 
ards are maintained, appear small in rela- 
tion to the prospective deficit; they do not 
reduce significantly the need for higher 
revenues at this time. 

I have repeatedly urged the Congress 
to raise postal rates so as to bring them 
into line with postwar costs. The need for 
such corrective action becomes steadily more 
urgent. It is unsound and unnecessary for 
the postal operation to continue as a growing 
burden on the general taxpayer. Instead, the 
users of the postal service should as a group 
pay the full cost of services received. This 
requires that the postal deficit be limited to 
the cost of air-line subsidies. Government 
mail, franked mail, and other items properly 
chargeable to the general revenues. 

Last year, the Postmaster General recom- 
mended to the Congress postal rate revisions 
designed to yield additional revenue of 
about 250 million dollars per year. Subse- 
quent increases in employees' pay and in 
transportation costs have rendered this 
amount inadequate. I therefore strongly 
urge again that the Congress pass legislation 
to bring the postal revenue more in balance 
with the expenditures of the service. The 
only alternative to increased rates or a con- 
tinued large deficit would be an undesirable 
reduction in the quality of services provided. 
As a longer range solution to this problem, 
there should be sufficient flexibility in the 
postal rate structure to permit at all times a 
proper relationship between revenues and ex- 
penses. 

Regulation, — Through regulation, the 
Federal Government seeks to assure the ade- 
quacy, economy, and safety of transporta- 
tion and communication services. Although 
the expenditures required for this activity 
are relatively small, this is one of the more 



95 



[p] Jan. 9 



Public Papers of the Presidents 



important responsibilities exercised by the 
Government in this field. The 195 1 Budget 
includes moderate increases for the regula- 
tory commissions, to permit them to reduce 
backlogs of pending cases, and to meet new 
problems more prompdy. 

Finance, Commerce, and Industry 

As part of its broad program for balanced 
economic development, the Federal Gov- 
ernment provides a variety of general finan- 
cial and other aids to promote the stability 
and growth of independent businesses. 
These are supplemented by regulatory action 
designed to remove monopolistic barriers 
to production and commerce. In addition, 
in two areas — exports and rents — it is neces- 
sary to continue, on a limited basis, wartime 
controls now in effect. Total expenditures 
in 195 1 are estimated at 212 million dol- 
lars, of which net expenditures for loans to 



business will account for about three-fourths. 
Business loans and guarantees, — In the 
past year, the Reconstruction Finance Cor- 
poration has contributed substantially to the 
financial stability of independent businesses, 
especially small business. The change in 
economic conditions last spring resulted in 
many financing needs which private lenders 
failed to meet, and consequently applications 
for Reconstruction Finance Corporation 
business loans increased rapidly. During 
recent months, the Corporation has been 
making about 450 new loans per month, or 
nearly twice the rate of a year ago. With 
the favorable business outlook now antici- 
pated, a somewhat lower level of new loan 
authorizations is estimated in 1951, but net 
expenditures are expected to rise above 1950 
because of disbursements on loans author- 
ized this year. In future years, repayments 
will provide increasing offsets to disburse- 
ments on new loans. 



Finance, Commerce, and Industry 



[ Fiscal years. In millions ] 



1949 
Program or agency actual 

Business loans and guarantees (Reconstruction Fi- 
nance Corporation, present programs and proposed 

legislation) $65 

Promotion and regulation of business: 
Department of Commerce: 

Promotion 23 

Export control 3 

Antimonopoly programs (Federal Trade Commis- 
sion, Justice) 7 

Rent control (Housing Expediter, present programs 

and proposed legislation) 22 

Other 7 

All other: 
Preferred stock of financial institutions (Recon- 
struction Finance Corporation) — 14 

Control of private finance 7 

Total 120 

* Less than one-half million dollars. 



Expenditures 



1950 
estimated 



$153 



25 
3 



22 
7 



(0 



225 



1951 
estimated 



I155 



23 
2 



16 

7 

-6 

7 



"New obligational 

authority for 1951 

Appropria 

tions 



60 



Other 



$250 



$20 
3 

8 

16 
6 

7 



250 



96 



Harry S. Truman, igp 



Jan. 9 [9] 



To make sure that this program will meet 
the needs of business for long-term credit, 
I am renewing the recommendation for a 
substantial increase in the present lo-year 
maximum on loan maturities. I also recom- 
mend an addition to the funds available for 
business loans. 

Promotion and regulation of business, — 
Since the war we have substantially strength- 
ened our antimonopoly program, but con- 
tinued improvement is essential. I have 
asked the Secretary of Commerce, in con- 
sultation with the Attorney General, the 
Federal Trade Commission, and the Council 
of Economic Advisers, to develop recom- 
mendations for increasing the effectiveness 
of this program. A major aspect of this 
study will be the development of methods to 
facilitate establishment of small businesses, 
to promote their stability and growth, and 
to remove obstacles to their survival as inde- 
pendent competitive enterprises. 

The Budget also provides additional funds 
for strengthening the antimonopoly activi- 
ties of the Federal Trade Commission. 
Among other things, this will permit a study 
of trends in industrial concentration to guide 
the formulation of Federal policy and to aid 
in prosecuting specific cases. 

As the record levels of housing construc- 
tion have gradually reduced the housing 
shortage, rent controls have been removed 
in many communities. This trend probably 
will continue. To prevent serious hardship 
to tenants in areas where shortages remain 
critical, I am recommending a i-year exten- 
sion of rent control authority beyond the 
present expiration date of June 30, 1950. 

Improvement in the supply situation has 
permitted removal of most commodities 
from export control. Export licensing of 
some strategic commodities, however, re- 
mains essential because of the uncertain in- 
ternational situation. 



Labor 

The programs of the Federal Government 
in the field of labor are designed to encourage 
increasingly effective use of our major pro- 
ductive resource — ^the skill of the American 
workingman — with the ultimate objective of 
assuring higher production and standards 
of living. To this end, the Government 
fosters responsible and peaceful labor rela- 
tions based on collective bargaining by offer- 
ing voluntary mediation services and provid- 
ing a remedy for unfair labor practices. It 
promotes fair labor standards for wages, 
hours, and employment conditions to prevent 
exploitation and unfair competition based 
on substandard conditions. It finances a 
free placement service to aid industry, agri- 
culture, and workers and insures workers, 
mainly through a Federal-State system, 
against total loss of income during periods 
of temporary unemployment. Finally, it 
collects and publishes information on wages, 
employment, prices, construction, and other 
subjects in order that business and economic 
planning and decisions may be on a factual 
basis. 

The importance of these programs is by 
no means measured by the total expenditures 
of 243 million dollars in 195 1, since many 
of the activities are regulatory in nature and 
require only minor expenditures. Of total 
expenditures, about 70 percent consists of 
grants to States for administration of the 
Federal-State employment service and un- 
employment compensation system. 

Placement and unemployment compensa- 
tion activities, — ^The Federal Government 
sets standards and pays all administrative 
costs for State operation of public employ- 
ment oiEces and unemployment insurance. 
Public employment oflSces placed applicants 
in more than 12,000,000 jobs during the past 
fiscal year. Of the total job placements, over 



41-355—65- 



-10 



97 



[9] Jan. 9 



Public Papers of the Presidents 



7,000,000 were on farms. Still more place- 
ments are expected in 1950 and 195 1. 

The unemployment compensation work 
load is closely related to general economic 
conditions. Last year the Congress recog- 
nized this fact by appropriating a contin- 
gency fund of 5 percent of the basic grants, 
to be used if the number of claims increased. 
It now appears that this contingency fund 
will not be sufficient to pay for the increase 
in work load which has occurred. I shall, 
therefore, request a supplemental appropria- 
tion for 1950. For 195 1, the Budget recom- 
mendations for the basic grants assume a 
somewhat lower average level of unemploy- 
ment but call for a contingency fund of 10 
percent to obviate delays in paying valid 
claims, should the volume of claims suddenly 
rise. 

Mediation and regulation of labor rela- 
tions, — In my State of the Union Message I 



have discussed the imperative need for basic 
revision of the Labor-Management Relations 
Act of 1947 to incorporate sound provisions 
on the rights and responsibilities of labor 
and management in relation to each other 
and to the general public, and to remove 
unworkable administrative provisions in the 
present law. This Budget allows for im- 
proving mediation and conciliation activities 
by providing funds to permit relatively equal 
service for all parts of the country and for 
the recently expanded organization for ad- 
justment of employee grievances in the rail- 
way industry. 

Labor standards and labor training, — The 
1949 amendments to the Fair Labor Stand- 
ards Act, while inadequate in many respects, 
made substantial improvements in the law 
by raising the minimum wage to 75 cents 
an hour and tightening the provision against 
the use of child labor in production for inter- 



Labor 
[ Fiscal years. In millions ] 

Expenditures 



Program or agency 
Placement and unemployment compensation activi- 
ties: 
Department of Labor: 

Present programs 

Proposed legislation (mainly reinsurance 

grants) 

Railroad Retirement Board 

Federal Security Agency 

Mediation and regulation of labor relations 

Labor standards and training: 
Department of Labor: 

Present programs 

Industrial safety program (proposed legisla- 
tion) 

Department of the Interior (mine safety) 

Fair Employment Practice Commission (proposed 

legislation) 

Labor information, statistics, and general adminis- 
tration 



1949 
actual 



*i5 

148 

12 



New oMigational 
authority for 19^1 
1 9 so J 95 1 Appropria- 

estimated estimated tions Other 



I137 



10 

37 
12 



I171 

12 
9 

13 



15 

6 

4 



$194 

13 
10 

13 



15 

6 

4 



Total . 



98 



193 



219 



243 



266 



Harry S. Truman, ig^o 



Jan. 9 [9] 



state commerce. I am recommending in- 
creased funds for the additional inspection 
and legal staff which effective enforcement 
will require. Such enforcement is essential, 
not only to protect the purchasing power of 
workers who need it most, but also to pro- 
tect law-abiding employers from unfair 
competition. 

Two legislative proposals respecting em- 
ployment conditions, and one on training, 
should be enacted promptly. First, a per- 
manent Fair Employment Practice Commis- 
sion should be established. To keep minor- 
ity groups economically submerged is not 
only unjust and discriminatory, but also 
prevents the best use of available manpower. 
Secondly, I am renewing my recommenda- 
tion for grants to States to assist them to 
encourage industrial safety. The Federal 
Government and the States spend many mil- 
lions of dollars each year to rehabilitate in- 
jured workers. It is only common sense to 
do what we can to prevent injuries in the 
first place. Finally, I recommend that a 
labor extension service be established in the 
Department of Labor to make available to 
wage earners educational programs designed 
to promote sound labor-management rela- 
tions. Such a program would require about 
3 million dollars a year after it gets into op- 
eration but would not have substantial effect 
on the 195 1 Budget because of the time re- 
quired to get under way at the local level. 

Trust accounts and unemployment com- 
pensation legislation, — ^Last year's temporary 
but sharp rise in unemployment provided the 
first real test of the Federal-State unemploy- 
ment insurance system since its establishment 
15 years ago. The system was of great help 
in tiding workers over temporary unemploy- 
ment and in sustaining markets for the prod- 
ucts of employed workers. During the last 
12 months, a total of 1.7 billion dollars in 
benefits was paid from the trust fund. At 
the same time, major shortcomings of the 



present system became painfully clear. It 
does not cover enough workers, and does not 
replace enough of the wages lost through 
unemployment. I shall submit proposals for 
legislation to overcome these and other de- 
fects by strengthening the present Federal- 
State system. 

At present, only about two-thirds of the 
workers employed in nonagricultural indus- 
tries are insured against the hazards of tem- 
porary unemployment. Coverage should be 
extended to employees of small establish- 
ments, of industries processing agricultural 
products, and of the Federal Government. 
This would raise coverage to about three- 
fourths of nonagricultural workers. Fur- 
thermore, legislation should include mini- 
mum Federal standards for eligibility and 
disqualifications, in order to remove some 
of the present inequalities in administration 
among the States. 

Present weekly benefits now average about 
one-third of previously earned weekly wages. 
The insurance was originally intended to 
replace at least half of previous earnings — 
the minimum needed to pay for food and 
rent — but benefits in many States have not 
kept up with price rises. In order to assure 
more nearly adequate benefits throughout 
the Nation, the Federal law should provide 
minimum standards for benefits paid from 
the State trust accounts. These standards 
should require benefits of 50 percent of pre- 
vious wages up to 30 dollars a week for 
single workers, with additional amounts for 
dependents up to 42 dollars a week for a 
worker with three dependents. The legis- 
lation should also require that benefits be 
available to eligible claimants for at least 26 
weeks. 

In addition to these changes in coverage 
and benefit standards, I shall recommend 
amendments to the financing provisions of 
present legislation, including establishment 
of a reinsurance system to provide grants to 



99 



[9] Jan. 9 



Public Papers of the Presidents 



Unemployment Trust Fund 

{Trust accounts) 

[ Fiscal years. In millions ] 

1949 
Item actual 

Receipts: 

Deposits by States and railroad unemployment taxes $994 

Interest 180 

Payments: State and railroad unemployment withdrawals — i, 327 

Net accumulation — 153 



1950 1951 

estimated estimated 



$1,018 $1,193 

162 165 

—2,034 —1,570 



-854 



States whose reserves for benefits become 
temporarily low, despite reasonable measures 
to maintain adequate funds. Although most 
States have sufficient reserves to pay higher 
benefits without increasing taxes, one or two 
States may need assistance by next autumn 
or shortly thereafter. 

The proposed legislation will affect chiefly 
the trust fund rather than the appropriations 
for administration. For both the trust fund 
and the appropriations, the effect in the fiscal 
year 1951 will be slight because time will be 
required for the State legislatures to revise 
their laws to conform with new standards 
established by the Congress. Benefits for 
Federal workers will represent the principal 
continuing budgetary cost of my recommen- 
dations. (The estimated expenditures for 
these benefits in the fiscal year 195 1 are 
shown under general government.) Esti- 
mates for proposed reinsurance appropria- 
tions are also included in the Budget. Ex- 
penditures from these appropriations will be 
necessary only if State reserves become in- 
adequate to provide for temporarily high 
numbers of insured unemployed. 

General Government 

The expenditures for general government 
cover legislative, judicial, and financial 
management activities, and also many 
Government-wide administrative services 
and programs such as property and records 



management, public buildings construction 
and maintenance, and the operations of the 
Civil Service Commission. The total ex- 
penditures for these programs for the fiscal 
year 1951 are estimated at 1.3 billion dollars 
compared to 1.2 billion for the current fiscal 
year. The increase is primarily for strength- 
ening further the system of tax collection, for 
the Government payment to the employees' 
retirement system, and for public building 
sites and plans. 

Internal revenue operations, — ^Efficient op- 
eration of the Bureau of Internal Revenue, 
the Federal Government's primary tax col- 
lection agency, is essential to protect the Fed- 
eral revenue and to assure fair treatment to 
taxpayers. Studies of the organizational 
structure and administrative procedures of 
this agency have been under way for some 
time and have already resulted in many im- 
provements, including the mechanization of 
some operations. These have enabled the 
Bureau to strengthen and extend its audit 
and enforcement activities, thereby collect- 
ing additional taxes, not only directly, but 
also by stimulating a greater degree of vol- 
untary compliance. Further improvements 
are in prospect. The 1951 appropriation 
provides for increased funds for these 
purposes. 

Property management, — Under mandate 
of the Federal Property and Administrative 
Services Act of 1949, the General Services 
Administration was established to consoli- 



100 



Harry S. Truman, ig^o 



Jan. 9 [9] 



date a number of Government-wide activities 
concerned with the procurement, mainte- 
nance, and disposal of Federal property. 
This was in accord with a major recommen- 
dation of the Commission on Organization 
of the Executive Branch of the Government. 
The General Services Administration is cur- 
rently undertaking to establish records stor- 
age centers and is emphasizing the expansion 
of inspection services and traffic manage- 
ment, determination of purchasing re- 



quirements, and controls to insure proper 
utilization of Government property. 

Civilian employees* retirement system. — 
Federal employees covered by the civil serv- 
ice retirement and disability system are re- 
quired by law to contribute 6 percent of their 
salaries toward future benefits; the Govern- 
ment contributes the remaining cost of bene- 
fits provided under the system. The 
expenditures of 333 million dollars estimated 
for 195 1 represent the Government payment 



General Government 



[ Fiscal years. 



Program or agency 

Legislative functions 

Judicial functions 

Executive direction and management 

Federal financial management: 

Bureau of Internal Revenue (Treasury) 

Customs collection, debt management, and other 
(mainly Treasury) 

General Accounting OflSce 

Other central services: 

Property management (mainly General Services 
Administration) 

Civil Service Commission 

Legal services (Justice) 

Government Printing Office 

Special fund for management improvement 

Government payment toward civilian employees* 

general retirement system 

Interest on refunds of receipts 

Public buildings construction (General Services Ad- 
ministration 

Weather Bureau (Commerce) 

Cemeterial program (Army and American Battle 

Monuments Commission) 

Immigration control (Justice) 

Other: 

Present programs 

Unemployment compensation payments to Federal 
workers (proposed legislation) 

Civil rights program (proposed legislation) 



In millions ] 

Expenditures 



1949 
actual 

$34 

19 

7 

208 



1950 
estimated 

$43 

27 

8 

230 



135 

35 


136 
36 


169 

16 

6 


139 

17 

8 


5 


9 

I 


224 
87 


301 
93 


3 

24 


22 
24 


58 
30 


30 
32 



68 



1951 
estimated 

$50 
31 
12 

253 

134 
37 



no 

17 

9 

II 



Islew obligational 
authority for 1951 

Appropria 
tions 

139 

24 

7 



333 
100 

53 
26 

21 

32 

24 

13 
I 



253 

133 

37 



99 

17 

9 

19 



333 
100 

28 
26 

13 
32 

47 

14 
I 



Other 



$3 



Total 1,170 1,223 1,267 *i,23i 3 

^ This Budget also includes 41 million dollars of appropriations to liquidate prior year contract author- 



lOI 



[9] Jan. 9 



Public Papers of the Presidents 



necessary to enable the fund to cover its 
currently accruing obligations. 

Construction of public buildings. — ^0£ esti- 
mated expenditures of 53 million dollars in 
1 95 1 for construction of public buildings, 
more than half is for acquiring sites and 
drawing plans for future construction in ac- 
cordance with the Public Buildings Act of 
1949. Expenditures for actual construction 
will be limited to projects already under way. 

Operation of the Weather Bureau, — 
Modest increases are requested to meet the 
increased demand for the services of the 
Weather Bureau. These include the require- 
ments for general weather service, aviation 
forecasts, and assisting in the protection of 
our forests from fire hazards. Increases in 
Adantic weather patrol observations and in 
forecasting and briefing services to pilots 
on international flights are to meet commit- 
ments under the International Civil Avia- 
tion Organization. 

Government of Guam, Samoa, and the 
trust territory of the Pacific islands. — It is 
the announced aim of this Government to 
accord civil government to the inhabitants 
of its non-self-governing Pacific Territories — 
Guam and American Samoa — ^which have 
been under American rule for half a cen- 
tury, and the trust territory of the Pacific 
islands which we administer under a 
United Nations trusteeship agreement. As a 
partial step in this direction I have trans- 
ferred administrative responsibility for 
Guam to the Secretary of the Interior and 
have directed that arrangements be made for 
a similar transfer on July i, 1951, with respect 
to American Samoa and the trust territory. 
This Budget includes 2 million dollars 
for Guam as part of a 4 million dollar 
appropriation recommended for admin- 
istration of Territories and possessions for 
the fiscal year 1951. I urge that the Con- 
gress enact the proposed organic acts now be- 
fore it, providing for the civil government 



of Guam and American Samoa, and similar 
legislation for the trust territory of the Pa- 
cific islands. 

Development of the National Capital. — 
I renew my request that the National Capital 
Park and Planning Commission be estab- 
lished on a stronger statutory basis. This 
would enable the Commission to fulfill more 
effectively its obligations to plan the orderly, 
coordinated development of the District of 
Columbia and nearby areas in Maryland and 
Virginia. 

Government Services Corporation. — Sev- 
eral organizations not within the normal 
governmental framework now provide, in 
Government buildings and on Government 
property, cafeteria and recreational services 
for Federal employees. I recommend that 
the Congress pass legislation now before it 
to create a self-supporting Government cor- 
poration to carry out these essentially gov- 
ernmental responsibilities. 

Federal employees* unemployment com- 
pensation. — ^The proposed broadening of the 
coverage of the unemployment compensa- 
tion program, recommended elsewhere in 
this Message, requires a Government pay- 
ment to extend coverage to Federal em- 
ployees. This Budget includes 13.5 million 
dollars for an appropriation to cover benefit 
payments in the second half of fiscal year 
1 95 1, when it is anticipated the program will 
be in operation. 

Civil rights program. — This Budget in- 
cludes funds to expand civil rights enforce- 
ment activities of the Department of Jus- 
tice under present laws. In addition to 
the amount provided for establishing a Fair 
Employment Practice Commission, there is 
included 800 thousand dollars as the amount 
needed under proposed legislation to estab- 
lish a permanent Commission on Civil 
Rights, which would continuously review 
our practices and policies in this field, and 
to provide for an additional Assistant At- 



102 



Harry S. Truman, ig^o 



Jan. 9 [9] 



Treasury Department 





Interest ON the Public Debt 








[ Fiscal years. In millions ] 




Appropria- 
tions for 






Expenditures 


I9SI {per- 




1949 


1950 1951 


manent 


Agency 


actual 


estimated estimated 


indefinite) 




$5, 352 


$5, 725 $5, 625 


$5, 625 



torney General to supervise a needed civil 
rights division in the Department of Justice. 

Interest on the Public Debt 

Interest on the public debt is a fixed obli- 
gation of the Government, determined by 
the amount of Federal securities outstanding 
and their interest rates. Payments are fi- 
nanced by permanent indefinite appropria- 
tions which do not require annual congres- 
sional action. 

Interest payments of 5.6 billion dollars 
estimated for 1951 are lower than those in 
1950, because a shift in reporting methods 
caused a nonrecurring addition of over 200 
million dollars in 1950. Under the new 
method, effective in the fiscal year 1950, all 
interest payments are now reported as they 
become payable rather than when they are 
actually paid. As a result of the transition, 
the 1950 total includes interest for prior 
years that was payable but had not yet been 
presented for payment at the beginning of 
the fiscal year 1950. This change does not 
significantly affect the reporting of interest 
payments in 195 1 and later years. 

Apart from this nonrecurring item, total 
interest payments will continue to rise in the 
fiscal year 1951. Each year more of the 
savings bonds sold during the war reach the 
stage where interest accrues at higher rates. 
Moreover, continuing accumulations of Gov- 
ernment trust funds will cause further in- 
creases in special issues to such funds of 
obligations bearing rates of interest higher 
than the average on the entire public debt. 



Finally, the Budget deficits this year and 
next will add to the total volume of interest- 
bearing debt. Savings in refunding opera- 
tions, however, will offset some of this in- 
crease in interest cost. 

Interest payments on the Federal debt are 
widely distributed, and represent a partic- 
ularly important source of income to certain 
institutions and groups. Almost 2 billion 
dollars of interest in the fiscal year 1951 is 
expected to go to individuals and unincor- 
porated businesses. About i billion dollars 
will be paid to commercial banks and almost 
1.5 billion to insurance companies, mutual 
savings banks, and other private investors. 
Another i billion dollars will go to Govern- 
ment retirement funds, social security funds, 
and various other Government trust funds 
to build up reserves out of which future 
benefits will be paid. Over 250 million 
dollars of interest in 195 1 will be paid to 
the Federal Reserve banks; more than half 
of such payments will be returned to the 
Treasury and deposited into miscellaneous 
receipts. The remainder will be used to 
defray most of the operating expenses of the 
Federal Reserve System, to pay dividends to 
member banks, and to add to surplus. 

PROPOSED LEGISLATION— A 
SUMMARY 

The following table shows estimated ex- 
penditures, appropriations, and other au- 
thorizations included in the Budget for 
programs under proposed legislation. The 
second table shows the effect of proposed 



103 



[9] Jan. 9 



Public Papers of the Presidents 

Proposed Legislation 

{Summary of amounts included in the Budget) 

[ Fiscal years. In millions ] 



Function and program 

EXTENSION OF EXISTING LEGISLATION 

International affairs and finance: 

Extension of European recovery program and other foreign aid. 

Extension of mutual defense assistance 



Estimated 

expenditures, 

1951 



$1, 700. 



Anticipated supplemental 
appropriations and other 
authorizations 



Inter-American highways 

National defense: Selective service program 

Housing and community development: 

Mortgage purchases 

Loans to pref abricators 

Extension and modification of loan insurance 

Agriculture and agricultural resources: Commodity Credit Corpora- 
tion 

Transportation and communication: 

Federal-aid postvj^ar highway program 

Forest highways 

Finance, commerce, and industry: 

Business loans and guarantees 

Extension of rent control 



10. o 
15.0 



Expenditures and appropriations (net) 2, 059. o 

Contract authorizations 

Public debt authorizations 

NEW LEGISLATION === 

International affairs and finance: 

Technical assistance to economically underdeveloped areas (Point 

IV) 25. 

Assistance to the Republic of Korea 110. o 

Contributions to International Trade Organization and other in- 
ternational organizations 2. 5 

Relief of Palestine refugees 20. o 

Expanded displaced persons program 2. 4 

Rama Road, Nicaragua 



National defense: Military functions (including public works) . 

Social welfare, health, and security: 

Expansion of public assistance programs 

Expansion of vocational rehabilitation program 

Aid to medical education 

Increased aid to local public health services 

Increased grants to States for maternal and child welfare . . . . 
Health services for school children 



70.0 

200. 3 

4.3 
30.0 

4.5 

6.9 

25. 



1950 



3.9 




125.0 


($500. 0) 


17.8 


(25.0) 


-12.7 





(2, 000. o) 



(2, 525. 0) 



65.0 



27.0 



I95I 



$3, 100. o 

647.5 

[500. 0] 

[8.0] 

4.2 

(250. o) 



[500. o] 
[20.0] 

(250. 0) 

16.0 

3, 767. 7 
[1,028.0] 
(500. 0) 



35-0 
115. o 

2.5 



2.6 
[8.0] 

131. 7 
[240. 0] 

250.3 

4-3 

45.0 

5.0 

9.5 
35.0 



Note. — [ ] indicate contract authorizations. ( ) indicate public debt authorizations. 



104 



Harry S. Truman, ig^o 

Proposed Legislation — Continued 
[ Fiscal years. In millions ] 



Jan. 9 [9] 



Function and program 
New Legislation — Continued 
Housing and community development: 

Cooperative housing for middle-income families 

Loans to other cooperatives 

Home Loan Bank Board stand-by borrowing authority 

Disaster relief 

Education and general research: 

General aid for operating expenses, elementary and secondary 
schools 

Surveys and emergency construction, elementary and secondary 
schools 

Education of children on Federal properties and in emergency 
areas 

General assistance to college students 

National Science Foundation 

Agriculture and agricultural resources: Administration of Commodity 

Exchange Act 

Natural resources: 

Research in utilization of salt water 

Baltimore- Washington Parkway 

Transportation and communication: 

Inland Waterways Corporation 

St. Lawrence seaway and power project 

Construction of public airports, Territory of Alaska 

Forest highways, Alaska 



Estimated 

expenditures, 

1951 



Anticipated supplemental 
appropriations and other 
authorizations 



1950 



Postal rate increase (increased revenue) 

Labor: 

Expanded unemployment insurance: Administration and reinsur- 
ance 

Industrial safety program 

Fair Employment Practice Commission 

General government: 

Strengthening Federal civil rights program 

Unemployment compensation payments to Federal workers 



$50.0 
30.0 

5.0 



290.2 

22. 2 

7.0 
0.9 
0.4 

0.7 

0.5 
2.0 

3.0 
4.0 
3.5 
2.9 
-395. 



12.4 
6.0 
0.6 

0.7 
13.4 

561.3 



($1,750.0) 



4.5 



96.5 



Expenditures and appropriations (net) 

Contract authorizations 

Public debt authorizations (i, 750. 0) 

* Estimated additional receipts of 60 million dollars in 1951. 

Note. — [ ] indicate contract authorizations. ( ) indicate public debt authorizations. 



1951 



$35.0 
(25. 0) 



5.0 

300.2 

45.2 

7.0 
I. 
0.5 

0.8 

0.5 
3.0 

3.0 
6.0 

2.9 

[4.4] 
-395. o 



12.5 
6.0 
0.7 



0.8 
13.5 

684.5 

[252. 4] 

(25. 0) 



105 



[9] Jan. 9 Public Papers of the Presidents 

Proposed Legislation Affecting Trust Funds 
[ In millions ] 

Function and program estimated 

social welfare, health, and security 
Extend and improve old-age and survivors insurance: 

Additional receipts Ii^ 200. 

Additional disbursements i^ 43,3. 

Net accumulation in reserve — 233. 

Medical care insurance: 

Receipts 250. 

Disbursements for initial expenses 35.0 

Net accumulation in reserve, 215. 



legislation upon the Government trust funds. 

Many of the programs listed under pro- 
posed legislation are actually continuations 
of programs already in existence but for 
which new authorizations are required to 
permit their continuance in 1951. These 
items are set forth separately in the first part 
of the table. 

The Budget also contains a general reserve 
for contingencies. It is designed as a mini- 
mum provision for activities not now 
definitely foreseen, but on which action may 
be required before the end of the fiscal 
year. 

The Budget for the fiscal year 195 1 reflects 
the great strength and the extensive respon- 
sibilities of this country. It represents much 
more than a collection of facts and figures — 
it represents the program which I am recom- 
mending for our Government in the months 
ahead. It will influence the course of events 
for years beyond 195 1, and the success with 
which we push ahead toward enduring 
peace, continuing economic growth, and a 
steady strengthening of our democratic 
society. 

In preparing this Budget, I have earnestly 
applied the fundamental principles which, in 
the present circumstances, should guide us 



in the conduct of our affairs. It is an honest 
Budget, which meets the realities which face 
us. It provides for essential activities on a 
minimum basis and no more, despite the 
great pressures which exist on every side 
for larger expenditures on specific programs. 
It meets the obligation of our Government 
to nourish and support the economic and 
social health of our Nation. It not only 
provides for substantial progress in 195 1 
toward our goal of budgetary balance but 
also lays the basis for further improvement 
in subsequent years consistent with the wel- 
fare of the country. 

We are still a young and growing Nation 
with a great reserve of human skills and 
productive resources. We have made and 
shall make more progress toward a less 
threatening world. Our strength is not be- 
ing impaired by our present great responsi- 
bilities and the temporary deficits required to 
meet them. Given wise policies, which meet 
the broadest tests of national welfare, we can 
look forward to the future with confidence. 

Harry S. Truman. 

note: The message was transmitted to the Senate 
and to the House of Representatives on January 9. 

The message and the budget document (1,198 
pp.) are published in House Document 405 (8ist 
Cong., 2d sess.). 



106 



Harry S. Truman, igp 



Jan. 12 [ii] 



10 Letter to the U.S. Representative on the United Nations 
Commission on the Status of Women. January lo, 1950 



My dear Judge Kenyan: 

I want to express my appreciation of your 
service as United States Representative on 
the Commission on the Status of Women of 
the Economic and Social Council of the 
United Nations during the past three years. 
I have been especially interested in the work 
of this Commission, for it is my belief, as I 
know it is yours, that the sound conduct of 
public business requires the full participa- 
tion of all citizens, men and women alike. 
The Commission has benefited by your prac- 
tical experience as a member of the Bar, 
especially in these first years of organization 
and planning. Your earlier service as an 
expert member of the League of Nations' 
Committee on the Legal Status of Women 
and in regard to the nationality problems of 
married women have also been an asset in 
selecting fields for action and evaluating 
results. 

I am well aware that you have carried the 



work of this Commission at a great sacrifice 
to your heavy law practice. I know, too, 
that you have given generously of your time 
to counsel with other members of the Com- 
mission and with the staS of the United 
Nations concerned with the Commission's 
objectives, as well as to interpret its progress 
to organizations and individuals throughout 
the United States. I hope that even though 
your term of office has expired, we may call 
on you from time to time for consultation on 
the numerous technical problems which 
arise in working to achieve equality for 
women in all countries. 

Very sincerely yours, 

Harry S. Truman. 

[Honorable Dorothy Kenyon, 50 Broadway, New 
York 4, N.Y.] 

note: Judge Kenyon was the first U.S. Representa- 
tive on the United Nations Conimission on the 
Status of Women. Appointed on November 7, 1946, 
her term expired on December 31, 1949. 



1 1 The President's News Conference of 
January 12, 1950 



THE PRESIDENT. I have uo announcements 
today. I will try to answer questions, i£ 
anybody has any on his mind. 

[i.] Q. Mr. President, have you reached 
any new decision on whether there is an 
emergency in coal that would warrant use of 
the Taft-Hardey Act.? 

THE PRESIDENT. There is no national emer- 
gency in coal at the present minute. 

[2.] Q. When is your tax program going 
up? 

THE PRESIDENT. Just as soou as we can get 
it ready. 

Q. Have you got anything you can tell us 
about now.f* 



THE PRESIDENT. No. It will all be con- 
tained in the message, and it will be very 
fairly stated. 

Q. Will it go up next week, Mr. Presi- 
dent.? 

THE PRESIDENT. I hopC SO.^ 

[3.] Q. Mr. President, the Attorney 
General is calling a conference on law en- 
forcement, and there has been some talk 
about getting an antiracketeering law against 
these "tygoons." Do you have any comment 
to make on that, sir? 

THE PRESIDENT. No commeut. I imagine 
that is what he has called the conference for, 

^ See Item 18. 



107 



[ii] Jan. 12 



Public Papers of the Presidents 



to come to a conclusion on it. 

[4.] Q. Mr. President, Senator Taft said 
in the Senate yesterday that Formosa is one 
place where, quote: "With a small amount 
of aid and at very small cost, we could 
prevent the spread of communism."^ Do 
you agree with that? 

THE PRESIDENT. Senator Taft is entitled to 
his own opinion. I didn't know he was a 
military expert, though. [Laughter] 

[5.] Q. Mr. President, do you plan to 
see the Governor of Puerto Rico when he 
comes here in the near future? 

THE PRESIDENT. Whenever the Governor 
of Puerto Rico is here and wants to see me, 
the door is always open to him, or the 
Governor of any other one of the Territories. 
I saw one this morning. 

[6.] Q. Mr. President, do you plan to 
change the Minister to Ireland ? 

THE PRESIDENT. Hadn't heard anything 
about it. I will certainly have to make the 
appointment if there is a change. 

[7.] Q. Mr. President, was that the Gov- 
ernor of Alaska that was here? 

THE PRESIDENT. The Govemor of Hawaii. 
The Alaskan Governor was here last week, 
I think. 

[8.] Q. Mr. President, did Mr. Aldrich 
make any suggestions for implementing 
point 4? 

THE PRESIDENT. We had a discussion on 
the subject, and there will be an announce- 
ment on it some time in the near future.^ 

[9.] Q. Mr. President, do you expect to 
have an announcement soon on the new 
member of the National Labor Relations 
Board? 



* The remarks of Senator Robert A. Taft are pub- 
lished in the Congressional Record (vol. 96, p. 298). 

^ Winthrop Aldrich, chairman of the board of the 
Chase National Bank of New York. In the spring 
of 1950 Mr. Aldrich, during a trip abroad, made a 
survey of economic conditions in a number of Euro- 
pean countries. On July 6, 1950, he reported his 
findings in a meeting with President Truman. 



THE PRESIDENT. YeS, I hopC tO. 

Q. This week? 

THE PRESIDENT. I Can't auswer it definitely. 

[10.] Q. Mr. President, have you no- 
ticed the close parallel between your budget 
and the CED budget 

Q. I didn't get that, Mr. President. 

THE PRESIDENT. Say that again. I didn't 
hear it, either. 

Q. Have you noticed the close parallel be- 
tween your budget and the CED budget, 
which on the surface looks like it's a big one 
but actually figures out very close to your 
budget? 

THE PRESIDENT. I haveu't giveu any study 
to any budget but my own, and it's all I can 
do to take care of that. I haven't seen the 
CED budget.^ 

[11.] Q. Mr. President, is there any new 
policy in the making on Spain? I notice 
Chairman Kee ^ made a speech 

THE PRESIDENT. I havc uo commeut on 
that. 

[12.] Q. Mr. President, would you give 
us your reaction to Mr. Boyle's ^ report on 
Ohio? 

THE PRESIDENT. Very satisfactory report 
from the Democratic standpoint. 

Q. Did he report, Mr. President, that he 
thinks the Democrats can beat Taft? 

THE PRESIDENT. He reported to me he 
thought the Democrats could win in Ohio. 
No personalities were gone into. [Laugh- 
ter] 

Q. Do you think he might have meant 
Senator Taft? [More laughter] 

*The Committee for Economic Development, a 
private nonprofit organization, released a report on 
January 7, entitled "Tax Expenditure Policy for 
1950," which called for a reduction in taxes and 
Federal spending in fiscal year 195 1 (Committee for 
Economic Development, 1950, 54 pp.). 

^ Representative John Kee of West Virginia. His 
remarks on Spain are published in the Congressional 
Record (vol. 96, p. 240). 

^ William M. Boyle, Jr., Chairman of the Demo- 
cratic National Committee. 



108 



Harry S. Truman, ig^o 



Jan. 12 [12] 



[13.] Q. Mr. President, the House Rules 
Committee is taking up FEPC tomorrow. 
Is that being done at your request? 

THE PRESIDENT. The House Rules Com- 
mittee, of course, is running its own busi- 
ness. The chairman of the Rules Com- 
mittee was in to see me this morning, and 
told me that they were going to take it up, 
and I was very highly appreciative that they 
are. 

Q. Thank you. 

Q. Do you think you can pass it this ses- 
sion, sir? 

THE PRESIDENT. Well, you will have to ask 
the leaders in the House. I can't answer that 
question. 

Q. Not the House; it's the Senate. 

THE PRESIDENT. Well, the Senate, then. 

[14.] Q. Mr. President, going back to 
Mr. Brandt's '^ question on Kee's speech, do 
you know whether that had the approval of 
the State Department, sir? 

THE PRESIDENT. I think the best way to find 
out is to ask the Secretary of State. I think 
he has a press conference each week, just like 
I do. 

Q. Not this week, he says. 

THE PRESIDENT. I think he had his press 



"^Raymond P. Brandt of the St. Louis Post-Dis- 
patch. 



conference down at the Press Club today .^ 

[15.] Q. Mr. President, after Senator 
Ferguson saw you the other day, he said he 
had a feeling that the Formosa subject was 
not closed, that there is a possibility perhaps 
of allowing them to hire military experts? 

THE PRESIDENT. I think that if you will 
read my statement on Formosa, it is thor- 
oughly and completely covered.^ 

Q. I did. Does that setde 

THE PRESIDENT. That scttlcs the question, 
so far as I am concerned. 

[16.] Q. Mr. President, is there any new 
plan of economic aid for southeast Asia in 
the works — in the making? 

THE PRESIDENT. No UCW plaUS, UO. 

Q. Is there anything you could tell us 
about economic aid to southeast Asia? 

THE PRESIDENT. No, I have no statement to 
make on it. 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You're wclcome. 

note: President Truman's two hundred and twelfth 
news conference was held in his office at the White 
House at 4 p.m. on Thursday, January 12, 1950. 

® Secretary Acheson's remarks at the Press Club on 
January 12 were directed to an examination of U.S. 
policy in Asia. He did not discuss Spain (see De- 
partment of State Bulletin, vol. 22, pp. 111-118). 
However, on January 18 Secretary Acheson re- 
viewed U.S. policy toward Spain in a letter to Sena- 
tor Tom Connally, Chairman of the Senate Foreign 
Relations Committee (ibid., p. 156). 

* See Item 3[i]. 



12 Remarks at a Supper for Democratic Senators and 
Representatives. January 12, 1950 



Mr, Chairman, Mr. Vice President, Mr, 
Spea\er, and fellow Democrats: 

It is a very great pleasure for me to be 
here again on this occasion. I was here last 
year and discussed with you certain experi- 
ences of mine as a Member of the Senate of 
the United States, and the difficulties I had 
had in being elected at various times — in 



1934, 194O5 1944, and I think I said some- 
thing about the election of 1948. 

But you have heard excellent advice from 
the Speaker of the House, and from the Vice 
President. And I hope that all of you will 
remember that the Democratic Party is the 
party of the people of the United States, and 
has been ever since Thomas Jeilerson. 



109 



[i2] Jan. 12 



Public Papers of the Presidents 



The president of Princeton University was 
in to see me yesterday, and told me that 
Princeton is pubUshing all the writings of 
Thomas Jefferson, and that there will be 51 
volumes of it, and that they have been to 
France, and to England, and to the Library 
of Congress, and to various places in the 
United States. They have found a letter 
down in Oklahoma from Thomas Jefferson 
to the Cherokee Indians, which is a classic. 
They are going to publish all those writings 
of Jefferson, and I hope someday somebody 
will publish all the writings of Jackson, and 
of Lincoln, and of Woodrow Wilson, and of 
Franklin D. Roosevelt in that same way in 
which Princeton is working on the writings 
of Jefferson. 

If they do that, they will find out why the 
Democratic Party never dies. It is the party 
of the people! 

Now, the Democratic Party has a program. 
You were all at Philadelphia, and you know 
what that program is. I believe that a party 
platform means what it says, and I am doing 
everything I can to carry out the platform of 
the Democratic Party of the United States, 
and I am going to keep fighting for that as 
long as I live. 



It has been a pleasure to be here with you 
tonight. It has been a pleasure to listen to 
Sam Rayburn, who has been a friend of 
mine ever since I have been in Washington, 
and to listen to my boss here, the Vice Presi- 
dent of the United States. He used to be 
the leader in the Senate, and as he said, I 
don't think he ever had to call on me or look 
around to find out whether I was going to 
support him as leader of the Senate. 

And I hope that the Democrats in the 
Senate of the United States will do that same 
thing for my friend Scott Lucas. 

I can't thank you enough for asking me 
to come here, and I hope that next year, 
after these fall elections, that we will have 
a Democratic Party that represents the people 
of the United States, in the House of Repre- 
sentatives and in the Senate — and you will 
have it in the Executive Office. 

Thank you very much. 

note: The President spoke at 8:30 p.m. at the Shore- 
ham Hotel in Washington. In his opening words 
he referred to William M. Boyle, Jr., Chairman of 
the Democratic National Committee, Alben W. 
Barkley, Vice President of the United States, and 
Sam Rayburn, Speaker of the House of Representa- 
tives. Later in his remarks the President referred 
to Scott Lucas, Democratic Senator from Illinois 
and Senate majority leader. 



Special Message to the Congress on Synthetic Rubber. 
January 165 1950 

[ Released January 16, 1950. Dated January 14, 1950 ] 



To the Congress of the United States: 

The tremendous increase in the use of 
rubber is one of the outstanding features of 
our industrial development in the last 50 
years. Rubber has become indispensable to 
the United States, in both peace and v^ar. 
Yet, 10 years ago this country w^as dependent 
for practically all of its supply of this essen- 
tial material on areas halfway around the 
world. Early in World War II these areas 
were lost, and it became necessary to develop 



a domestic source of rubber. The creation, 
in the midst of war, of a new industry ca- 
pable of supplying a million tons of synthetic 
rubber a year was one of the great achieve- 
ments of our war effort. 

Since the war, the sources of natural rub- 
ber have again become available to us, and 
production has increased as the destruction 
and dislocations of war have been overcome. 
At the same time, the world demand for 
rubber has risen so far above the prewar 



1 10 



Harry S. Truman, ig^o 



Jan. i6 [13] 



levels that the supply of natural rubber is 
still less than demand. Thus, continued 
production of synthetic rubber in this coun- 
try has prevented a serious w^orld rubber 
shortage. 

Facilities for producing general-purpose 
synthetic rubber, commonly called GR-S, 
are owned by the Government, as arc the 
plants for producing butyl, the type of syn- 
thetic rubber used primarily in inner tubes. 
Facilities for producing other types of syn- 
thetic rubber are now^ all privately owned. 
In 1949 about 289,000 long tons of GR-S 
and 52,000 long tons of butyl were produced 
by the Government. In addition, about 
53,000 long tons of other synthetic rubbers 
were produced in privately owned plants. 

It is essential to our national security that 
facilities to produce enough high-quality 
synthetic rubber to meet our needs in an 
emergency be continuously available. We 
must build up a stockpile of natural rubber, 
and we have been doing so, but the ac- 
cumulation of a stockpile large enough to 
meet all emergency needs for rubber is im- 
practical. We must be equipped to meet 
the bulk of our needs from domestically 
produced rubber. 

The Government's synthetic rubber ac- 
tivities are now conducted under the Rubber 
Act of 1948, which expires on June 30, 1950. 
This legislation provides that capacity for 
production of synthetic rubber shall be main- 
tained in the United States at all times, and 
requires that minimum quantities shall be 
produced and consumed each year. It pro- 
vides authority for continued Government 
production of synthetic rubber, for regula- 
tions requiring its consumption in certain 
products, for stand-by maintenance of plants 
not in operation, and for continued Govern- 
ment research in synthetic rubber. Al- 
though the act prohibits the disposal of the 
facilities in the synthetic rubber program, it 
declares it to be the policy of the Congress 



that Government ownership shall terminate 
whenever consistent with national security. 
The act provides that on or before January 
15, 1950, the President shall recommend to 
the Congress "legislation with respect to dis- 
posal of Government-owned rubber-pro- 
ducing facilities . . . together with such 
other recommendations as he deems desirable 
and appropriate." 

As a basis for making recommendations 
to the Congress, I have had made a thorough 
investigation of all aspects of the rubber 
problem. A report summarizing the results 
of this investigation is transmitted to the 
Congress with this message. The detailed 
recommendations in that report have my 
approval. 

The rubber policy of the United States 
should be based upon the fundamental na- 
tional objectives of protection of the national 
security, promotion of a free competitive 
economy, and achievement of a peaceful and 
prosperous world. I recommend that legis- 
lation succeeding the Rubber Act of 1948 
be enacted, setting forth this rubber policy, 
and providing for continuation of the syn- 
thetic rubber industry in a manner consistent 
with these objectives. 

In order to maintain the productive capac- 
ity needed in the event of emergency, the 
President should have the authority to desig- 
nate the plants which must be kept available 
at all times for synthetic rubber production. 
On the basis of present technology and esti- 
mated requirements, it appears that our 
present plant capacity of nearly a million tons 
a year should be maintained to be prepared 
to meet emergency needs for synthetic rub- 
ber. It is not necessary, however, that all 
this capacity be in operation. Maintenance 
in a stand-by condition of those plants which 
are not being used should, therefore, be 
authorized. 

In order to encourage technological devel- 
opment in the production and use of syn- 



III 



[i3] Jan. i6 



Public Papers of the Presidents 



thetic rubber and to provide a basis for rapid 
expansion of production if this proves nec- 
essary, at least a minimum quantity of each 
type of synthetic rubber must be produced 
and consumed. Certain types of synthetic 
rubber, v^^hich are privately manufactured, 
have established a sufficiently strong position 
in the competitive market to assure a con- 
tinuing demand for them. Recent improve- 
ments in butyl rubber, w^hich is produced 
only in Government-ov^ned plants, make it 
superior to natural rubber for use in inner 
tubes, its major use. It is probable, there- 
fore, that as soon as private production of 
butyl begins, this type of synthetic rubber 
will be produced and consumed in adequate 
volume in a competitive market. Until 
butyl is privately produced, however, the 
President should have the authority to deter- 
mine the minimum quantities of butyl which 
must be produced and consumed, and to 
the extent necessary to require its use in 
specified products. 

The situation with respect to general-pur- 
pose synthetic rubber (GR-S) is not quite 
so favorable. Since it is not yet a satisfactory 
substitute for natural rubber in all of the 
products for which it would be used in an 
emergency, it is desirable that the Govern- 
ment's authority to conduct research in this 
field continue. The physical properties of 
GR-S have been steadily improved in recent 
years, and at present the quality differences 
between GR-S and natural rubber for peace- 
time general-purpose uses (chiefly passenger- 
car tires) are not significant. Price differ- 
entials are likely to be the determining factor 
in the choice between the two rubbers for 
most uses. It is very possible that for some 
time to come a considerable volume of GR-S 
production will be required, since the supply 
of natural rubber is not likely to be sufficient 
to meet world market demand. This possi- 
bility, however, is not an adequately depend- 



able base for national security planning. 

I believe that, at the present time, at least 
one-quarter of total consumption of GR-S 
and natural rubber, and not less than 200,000 
long tons annually, should be GR-S. How- 
ever, the needed level of production and 
consumption may change over the next few 
years wdth changes in world conditions. 
Therefore, the President should be given the 
authority to establish from time to time the 
minimum level of production and consump- 
tion necessary to the national security. 

The present technological position of gen- 
eral-purpose synthetic rubber is such that 
it probably could not compete for bulk uses 
with natural rubber offered at significandy 
lower prices. There is thus no adequate 
assurance that the demand for GR-S either 
because of the possible shortage of natural 
rubber or because of its technological quali- 
ties, will be sufficient to insure production 
and consumption at levels necessary for na- 
tional security. The President should, there- 
fore, have authority to require the use of 
GR-S in certain products to the extent nec- 
essary to assure such production and con- 
sumption. 

The minimum level of production and 
consumption should not be higher than the 
national security requires, for if it were, it 
would unduly prevent consumers in this 
country from realizing the benefits of mai'ket 
competition, and interfere with our objec- 
tives of expanding world trade and world 
prosperity. 

It is my earnest hope that controls on con- 
sumption of GR-S may be reduced or sus- 
pended over the next few years, as tech- 
nological improvements result in increasing 
quantities of general-purpose synthetic rub- 
ber being consumed without Government 
support. This development should be stim- 
ulated by the disposal of the Government's 
plants to private owners. 



112 



Harry S. Truman, ig^o 



Jan. i6 [14] 



The President should be authorized to dis- 
pose of the synthetic rubber facilities to pri- 
vate owners, under conditions which will 
protect the national security and promote 
effective competition. 

The disposal of these plants while pro- 
moting effective competition will present 
many difficult problems. The plants are 
large and involve large-scale operations. 
Furthermore, only a few plants are required 
to meet the probable demand for both re- 
quired and anticipated voluntary consump- 
tion of synthetic rubber. The legislation 
authorizing disposal should take account of 
these facts, and provide specific standards 
designed to assure that the disposal program 
will actively promote effective competition 
and avoid monopolistic concentration. 

A special problem will arise when general- 
purpose synthetic rubber plants are privately 
owned, if the Government continues to re- 
quire the use of synthetic rubber in certain 
products. In this situation, the Government 
must see that synthetic rubber is made avail- 
able on fair and reasonable terms and con- 
ditions to those required to use it. Such 
Government intervention in the normal 
buyer-seller relationship will present diffi- 
cult practical problems for both industry and 
Government. Development of a vigorous 



private synthetic rubber industry, however, 
may soon result in adequate consumption of 
synthetic rubber to permit removal of Gov- 
ernment regulation. 

I believe that the policies outlined in this 
message and the detailed recommendations 
contained in the accompanying report pro- 
vide a sound program for action. For this 
reason, the legislation establishing these 
policies can be of relatively long duration. 
Furthermore, a firmly established legislative 
framework is highly desirable if disposal of 
the Government's synthetic rubber plants is 
to be successful. I recommend the adoption 
of legislation of ten years duration in order 
to provide adequate protection of the na- 
tional security and to contribute to the de- 
velopment of a vigorous, competitive, and 
privately owned synthetic rubber industry 
in the United States. 

Harry S. Truman 

note: a report by John R. Steelman, Assistant to 
the President, entitled "A Report to the President on 
the Maintenance of the Synthetic Rubber Industry in 
the United States and Disposal of the Governnient- 
Owned Synthetic Rubber Facilities," was trans- 
mitted with the message (see House Document 448, 
8 1 St Cong., 2d sess.). 

On June 24, 1950, the President approved a bill 
extending the Rubber Act of 1948 until June 30, 
1952 (64 Stat. 256). 



14 Remarks at a Dinner Given by the Chairmen and Directors 
of Federal Reserve Banks. January i6, 1950 



Mr. Chairman, gentlemen: 

I haven't any business to be discussing 
things financial with the financial brains 
that are before me tonight. I am just a 
farmer from Missouri who had bad luck 
and got kicked into a big job. I was telling 
the gentleman on my right here how that 
came about, and I think he is still somewhat 
skeptical. 



But naturally I am, and always have been, 
interested in the financial stability of govern- 
ment, whether that government is village, 
city, county, State, or national. I have spent 
most of my time studying — since I have been 
in politics, and that has been a long time — 
fiscal policies of various segments of the 
Government of the United States, which in 
my opinion is the greatest Government that 



113 



[14] Jan. 16 



Public Papers of the Presidents 



the sun has ever shone upon, for the simple 
reason that it is a Government of check and 
balance. It is a Government that no one 
man or any one group of men can control. 
It is a Government that is intended to be in 
the interests of all the people, and it is 150 
million that make it up. 

I had my first experience in government 
fiscal matters as the presiding and executive 
officer of a county of 500,000 people. And 
the problems of that county of 500,000 peo- 
ple wtxt just exactly parallel with the prob- 
lems of 150 million. I had exactly the same 
trouble w^ith the bankers that I have now. 
And I had no difficulty in convincing them, 
when I thought I was right and when I 
proved to be right, that the right thing to 
do was what they finally did. 

I appreciate very much the kind remarks 
that your Federal Reserve Chairman has 
made about me. I hope that his compli- 
ments and his good thoughts of me will 
never have to be called back, because my 
only interest, my only interest, as President 
of the United States, is the welfare of the 
United States of America. And the welfare 
of the United States of America is the wel- 
fare of the world. 

Whether we like it or not, we are at the 
top of the heap in world affairs, a position 
which none of us likes to contemplate, a 
position which has responsibilities almost too 
big for any man or any group of men to 
contemplate. Yet that position is ours. 
And the fact that we are willing to assume 
the responsibility that goes with that posi- 
tion is a part of your responsibility, as well 
as a part of the responsibility of the United 
States Government, made up of its Congress, 
its judiciary, and its President. 

This is a serious age through which we 
are going. This is the aftermath of the 



greatest struggle in the history of the world 
for free government. Never after a struggle 
of anything like these proportions have we 
had as many problems to face as we have 
today. 

They are the problems of every citizen of 
the United States, from the taxicab driver 
out here at the door to the president and 
chairman of the board of the greatest bank 
in the United States, as well as the problems 
of the President of the United States who is 
the elected official at the head of the Govern- 
ment. 

For that reason I came over here at Tom 
McCabe's request to meet you and get 
acquainted with you, and to let you know 
that in spite of certain information, which 
has been pretty well distributed, that I do not 
wear horns and I haven't a tail — I am just an 
ordinary citizen of this great Republic of 
ours who has the greatest responsibility in 
the world and whose responsibility is your 
responsibility, and for that reason it is nec- 
essary that all of us make every effort possible 
to make successful the goal which we are 
attempting to attain. 

And that is peace in the world — peace in 
Europe, peace in Asia, peace in South 
America, peace in Africa, peace in the West- 
ern Hemisphere, and the assumption of the 
leadership necessary to bring that about. 

Now gentlemen, you represent the great- 
est financial institution in the history of the 
world, except the Treasury of the United 
States. And between the two of you, we can 
attain this goal: world peace, world pros- 
perity, and the welfare of all the people. 

That is all I am striving for. That is what 
I hope to have the country on the road to 
accomplishing when my service as the head 
of the greatest Government in the history of 
the world ends. 



114 



Harry S. Truman, ig^o 



Jan. 19 [16] 



note: The President spoke at 9:20 p.m. at the 
Carlton Hotel in Washington. His opening words 
"Mr. Chairman" referred to Thomas B. McCabe, 



Chairman of the Board of Governors of the Federal 
Reserve System. 



15 Remarks to a Delegation From the National Emergency Civil 
Rights Mobilization Conference. January 17, 1950 



YOU don't need to make that speech to me, 
it needs to be made to Senators and Con- 
gressmen. Every ejflort is being made by the 
executive branch of the Government to get 
action on these measures. I have been w^ork- 
ing at them ever since I went to Congress. 
I went there in 1935, and that is a long time 
ago. 

We have made some progress. We 
haven't made enough. We hope to make 
more. The passage of the resolution by the 
Rules Committee of the House the other day 
is a blow that is serious and backward- 
looking. I am doing everything possible to 
have that motion beaten when it comes up 
for consideration on the floor of the House. 
Every effort is being made to get a vote on 
these measures in the Senate. The leader of 
the majority and the Vice President have 
assured me that they will eventually get a 
vote, if it takes all summer. 

I hope that when that vote is taken we will 
be in a better position to understand who 
our friends are, and who are not. 

This is a serious situation. This civil 
rights program, which I have sent to the 



Congress on every occasion that it has been 
possible to send it, is one that is necessary, 
if we are going to maintain our leadership 
in the world. We can't go on not doing the 
things that we are asking other people to do 
in the United Nations. 

I hope all of you will continue your hard 
work on the subject, and that you will make 
it perfectly plain to the Senators and Con- 
gressmen who represent your States and 
districts that action is what we want; and 
I think that is possibly the only way we can 
get action. 

I thank you very much. 

note: The President spoke at 12:10 p.m. in his 
office at the White House. 

The National Emergency Civil Rights Mobiliza- 
tion Conference, sponsored by 55 organizations inter- 
ested in the promotion of civil rights, was held in 
Washington January 15-17, 1950. The conference 
had as its objective support for the President's civil 
rights program and particularly for the fair employ- 
ment practice bill. 

The delegation that met v^^ith the President wsls 
headed by Roy Wilkins, chairman of the conference 
and acting secretary of the National Association for 
the Advancement of Colored People. As Mr. Wil- 
kins started to read a prepared statement he was 
interrupted by the President. 



16 The President's News Conference of 
January 19, 1950 



THE PRESIDENT. I have uo Special announce- 
ments to make this morning, but I will try 
to answer your questions if I can. 

[i.] Q. Mr. President, do you plan to 



name a successor to Myron Taylor .^^ 
THE PRESIDENT. The matter is under study. 
Q. Does that go also, Mr. President, for 

continuing the mission .^^ 



115 



[i6] Jan. 19 



Public Papers of the Presidents 



THE PRESIDENT. It is undcf study, yes.^ 

Q. What was the answer, sir? 

THE PRESIDENT. The matter is under study. 
The State Department is studying it. I 
think Dean Acheson answered that yester- 
day.^ 

[2.] Q. Mr. President, has it been deter- 
mined when the tax message will go up? ^ 

THE PRESIDENT. As quickly as it is ready. 
It will go up in a few days. We have been 
working very hard on it. No controversy. 
It is a technical matter. Takes a litde time 
to get it ready. 

[3.] Q. Mr. President, do you plan to 
fill the vacancy on the War Claims Commis- 
sion any time soon, sir? 

THE PRESIDENT. On what? 

Q. The War Claims Commission. You 
recall that one of the commissioners was 

THE PRESIDENT. Oh yes, he was killed in 
an airplane accident. Yes, we will fill that 



* Myron C. Taylor was appointed as the Presi- 
dent's Personal Representative at the Vatican on 
December 23, 1939; his resignation became effec- 
tive on January 18, 1950. His letter of resignation 
and the President's reply, both dated January 18 
and released by the White House on the same date, 
are published in the Department of State Bulletin 
(vol. 22, p. 181). 

On October 20, 1951, the President appointed 
Gen. Mark W. Clark to be the first U.S. Ambassador 
to Vatican City. According to reports in the press 
the White House reaffirmed the power of the Presi- 
dent to establish diplomatic relations with the 
Vatican without consulting Congress but announced 
that the President would request congressional ap- 
proval of the nomination. 

After widespread controversy on the appointment 
and protests from numerous Protestant groups, Gen- 
eral Clark withdrew as the nominee on January 13, 
1952. A U.S. Ambassador to Vatican City was 
not appointed during the Truman administration. 

^On January 18, 1950, Secretary Dean Acheson 
sent a telegram to the American Embassy in Rome 
concerning the office of the President's Personal 
Representative at the Vatican. The text of the 
telegram was not released. 

^ See Item 18. 



as promptly as we can.'* 

[4.] Q. Mr. President, is Charles Luck- 
man being persuaded to accept a Govern- 
ment position? 

THE PRESIDENT. Not that I kuow o£. I 
haven't had any conversation with him on the 
subject. All I know about what has hap- 
pened is what I saw in the paper. 

[5.] Q. Mr. President, are you consider- 
ing direct negotiations with Russia on the 
hydrogen bomb .f^ 

THE PRESIDENT. No. 

Q. Mr. President, has David Lilienthal 
offered to go to Russia on that subject .f* 

THE PRESIDENT. No, he has not. 

[6.] Q. Mr. President, the National 
Lawyers Guild, I believe, has asked you to 
investigate the FBI, I think, again. Have 
you received any such request.? 

THE PRESIDENT. We have received no 
formal communication from the Lawyers 
Guild. 

Q. Nothing formal 

THE PRESIDENT. We have received no 
formal communication. I have heard lots 
of rumors on the subject. 

Q. Would you like to say something about 
it.? 

THE PRESIDENT. No, I have no comment. 

Q. Mr. President, we didn't hear the 
question, I'm sorry. 

THE PRESIDENT. They Wanted to know if 
the Lawyers Guild was going to ask me to 
investigate the FBI, and I told him I hadn't 
heard it officially. 

[7.] Q. Mr. President, what did you see 
Congressman Sabath about this morning.? 



*On February 28, 1950, the President transmitted 
to the Senate the nomination of Myron Wiener as a 
member of the War Claims Commission. The ap- 
pointment filled the vacancy created by the death of 
David N. Lev^is on November 29, 1949, v^hen he 
was killed in the crash of an airliner in Dallas, Tex. 



116 



Harry S. Truman, igp 



Jan. 19 [16] 



THE PRESIDENT. The proposcd change in 
the rules of the House. He came up to 
talk to me about it at my suggestion.^ 

Q. Are you against it? [Laughter] 

THE PRESIDENT. Of couTse I am against it. 
I hope they won't do it. 

Q. Mr, President, he suggested he might 
make a change himself, by way of appeasing 
the southerners. Did he discuss that with 
you? 

THE PRESIDENT. I dou't know what that 
change is. I didn't discuss that with him. 
I told him I was opposed to the change. 
Period. 

Q. Was he optimistic about beating it? 

THE PRESIDENT. He thought he could beat 
it. That is the change. 

Q. Mr. President, have you spoken to 
Speaker Rayburn on this whole subject of 
the rules change 

THE PRESIDENT. Yes, I have — yes, I have. 
I have talked to Speaker Rayburn every 
Monday on the subject for the last year and 
a half, and the year before that, also. 

Q. I mean particularly this Monday, sir? 
[Laughter] 

THE PRESIDENT. Yes, we discussed it. 

Q. Are you in agreement on it, Mr. Presi- 
dent? 

THE PRESIDENT. YeS. 

[8.] Q. Mr. President, is there a nomina- 
tion in sight for Alien Property Custodian? 
THE PRESIDENT. I thought the Alien Prop- 



" Representative Adolph J. Sabath of Illinois, 
Chairman of the House Rules Committee. The 
proposed change in the rules had to do with an 
attempt to restore the power of the Committee to 
pigeonhole bills. Under the rule in effect since 
January 3, 1949, any bill held up by the Rules Com- 
mittee for 21 days could be brought to the floor 
at the call of the chairman of the committee of 
original jurisdiction — ^provided the Speaker recog- 
nized him for such a call. On January 20 the 
House voted 236-183 to retain the 21 -day rule. 



erty Custodian business was wound up. 
Which is it? Maybe Fm mistaken — I was 
thinking about surplus property. That is 
about to wind up. 

[9.] Q. Mr. President, were you able to 
work out an agreement on the Missouri sen- 
atorial primary with the Missouri politicians 
this week? 

THE PRESIDENT. I made a statement last 
week in which I said that I was for Allison,^ 
and I think you will find the Missouri poli- 
ticians generally in agreement with that. 

Q. Generally in agreement? 

THE PRESIDENT. Yes. [Laughter] 

Q. Mr. President, does that mean that 
these other men may withdraw? 

THE PRESIDENT. I Can't auswer that ques- 
tion. You see, Missouri has a free primary, 
and anybody in the world can run that wants 
to. There is nothing to prevent them — 
nothing to prevent them trying it. I am 
just answering your question. 

[10.] Q. Mr. President, are your legal 
advisers in agreement with Senator Taft, 
who says that the Taft-Hardey Act oilers 
no basis for Mr. Denham's action yester- 
day against the ^ 

THE PRESIDENT. I Can't auswer that. Mr. 
Denham is acting for the National Labor 
Relations Board. He has a right to take 
such steps as he thinks the law provides. He 
has been in close touch with the White 



•See Item 3 [8]. 

^On January 18, Robert N. Denham, General 
Counsel, National Labor Relations Board, filed a peti- 
tion in the Federal District Court to compel John L. 
Lewis and the United Mine Workers of America 
to restore normal coal production. 

Denham based his petition on the section of the 
Taft-Hardey law forbidding unfair labor practices. 
According to the New York Times, Senator Robert 
A. Taft of Ohio stated that he did not believe the 
avenue of approach used by Mr. Denham would be a 
suitable substitute for invocation of the national 
emergency section of the Taft-Hartley Act. 



117 



[i6] Jan. 19 



Public Papers of the Presidents 



House, but the White House has had nothing 
to do with his actions. 

[11.] Q. Mr. President, do you favor 
former Assistant Attorney General Alex 
Campbell for nomination to the Senate in 
Indiana? 

THE PRESIDENT. I am not in the Indiana 
senatorial primary. I am only in the Mis- 
souri primary. 

Q. Yes, sir. 

THE PRESIDENT. After the primary is over 
in Indiana I hope to help elect a Democratic 
Senator from Indiana. 

[12.] Q. Mr. President, getting back, 
did you say that Missouri Democrats v^ere 
in general agreement with you, or generally 
in agreement with you? [Laughter^ 

THE PRESIDENT. Now, what do you mean 
by that question? {More laughter] Are you 
a lawyer? What do you mean by that ques- 
tion? I think it means the same thing. 

[13.] Q. Mr. President, it has been re- 
ported in Chicago that come election time — 
not primary time — that you will be making 
one or more speeches in Illinois for Senator 
Lucas? 

THE PRESIDENT. We wiU cross that bridge 
when we get to it. Of course, I want Sena- 
tor Lucas to come back now, and I will do 
everything I can to help him come back. 
If it requires that, I will do it. 

[14.] Q. May I go back to the Denham 
matter a moment? 

THE PRESIDENT. YeS. 

Q. I understand he has a right to take 
what action he thinks proper? 

THE PRESIDENT. That is correct. 

Q. Have you had communication with him 
on the subject? 

THE PRESIDENT. No. He was in communi- 
cation with me. I had no communication 
whatever. He told us what he was going 
to do, and we listened. 



[ 15.] Q. Mr. President, have you decided 
on the successor to Mr. Lilienthal? ^ 

THE PRESIDENT. No, I havc not. I will 
announce it whenever I am ready. 

[16.] Q. Mr. President, is there anything 
more you can tell us about the plans for the 
leaders in the Senate to keep the Senate 
through the summer if necessary to get a 
civil rights vote? 

THE PRESIDENT. No, I cau't commeut fur- 
ther on that. I have said all that is necessary. 

What is it somebody wants to ask me? 

[17.] Q. Do you plan any further action 
in the coal dispute? 

THE PRESIDENT. I am in constant touch 
with the situation in the coal industry. 
When the situation develops to the point 
where it is necessary for me to take action, 
I will take it. 

[18.] Q. Mr. President, do you have 
under consideration the production of a 
hydrogen bomb? 

THE PRESIDENT. I caunot couimeut on 
that.^ 

[19.] Q. Mr. President, you won't take 
any part in the primary race in South Caro- 
lina ? 

THE PRESIDENT. I will take no part in any 
primary race outside the State of Missouri, 
That is my State, where I have the right to 
do as I please. The other States have a right 
to do as they please. After the primaries are 
over, then I will be in a different frame of 
mind. 

[20.] Q. Has anybody discussed the 
question of a formula by which you can go 
to determine when there is and when there 

®The resignation of Davil E. Lilienthal as Chair- 
man of the Atomic Energy Commission became 
effective on February 15, 1950. On February 16, 
1950, the President designated Sumner T. Pike as 
Acting Chairman of the Commission, and on July 
II, 1950, Mr. Truman appointed Gordon E. Dean 
to be Chairman of the Commission. 

® See Item 26. 



118 



Harry S. Truman, ig^o 



Jan. 19 [16] 



is not a coal emergency, that is, when the 
shortage is 

THE PRESIDENT. The decision is in the 
hands of the President, and when the Presi- 
dent thinks there is an emergency, he will 
declare it and take whatever action is neces- 
sary. 

Q. In other words, the emergency has not 
arisen? 

THE PRESIDENT. The emergency is not 
here. The national emergency is not here. 

Q. Mr. President, if things go on as they 
are now, how long do you think it will be 
before there would be a national emergency? 

THE PRESIDENT. Your gucss is as good as 
mine. I get constant reports on the situation. 
When I think there is an emergency, I will 
make a statement on it, and I think you will 
understand it clearly. 

Q. Does an emergency threaten, Mr. 
President? 

THE PRESIDENT. I don't carc to answer that 
question. You will have to dig that up for 
yourself. 

Q. Has the Denham action your blessing, 
Mr. President? 

THE PRESIDENT. Mr. Dcuham is working 
for the National Labor Relations Board, and 
it is not my business to bless him or unbless 
him. [Laughter] 

Q. Mr. President, if there is no objection — 
is there any connection between Mr. Den- 
ham's action and the presence or the lack of 
presence of a national emergency? 

THE PRESIDENT. Noue that I know of. 
None that I know of — no connection. Mr. 
Denham was requested to take any action 
ever since the 31st of December, and he has 
generally decided to take it. 

Q. It isn't really a national emergency? 

THE PRESIDENT. No, uo. Has nothing to 
do with a national emergency. 

[21.] Q. Mr. President, you don't have 



any comment on former Secretary Jimmy 
Byrnes entering ^° 

THE PRESIDENT. No, I have no comment. 
Mr. Byrnes is a free agent to do as he damn 
pleases. [Laughter] 

Q. That's a good quote, Mr. President! 
[Laughter] 

[22.] Q. Mr. President, I want to ask 
one question, because I know that every- 
body wants it answered. Will there be any 
change in the status of General Vaughan as 
a result of the reports ^^ 

THE PRESIDENT. There will be none. 

[23.] Q. On the subject of Mr. Denham, 
Mr. President, have various calls which have 
been sounded by individuals for the recall 
of Mr. Denham been brought to your atten- 
tion in any official 

THE PRESIDENT. I have sccu them in the 
paper, but nowhere else. 

Q. Nowhere else? 

THE PRESIDENT. Nowhere else but in the 
paper. Like a lot of other guesses that get 
into the papers. [Laughter] 

Reporter: Thank you, Mr. President. 

note: President Truman's two hundred and thir- 
teenth news conference was held in his office at the 
White House at 10:30 a.m. on Thursday, January 
19, 1950. 



" On January 14 James F. Byrnes, former Secretary 
of State, announced that he would be a candidate 
for the Democratic nomination as Governor of 
South CaroUna. 

^Maj. Gen. Harry H. Vaughn, Military Aide to 
the President. 

The report of the Investigations Subcommittee of 
the Senate Committee on Expenditures in the Execu- 
tive Departments, entided "The 5-Percenter Investi- 
gation," was submitted to the Senate on January 
18, 1950. It is published in Senate Report 1232 
(8 1st Cong., 2d sess.). 

The report dealt with the problem of "manage- 
ment consultants," influence peddlers who sought 
to convince the small businessman that their serv- 
ices were needed in order to obtain Government 
contracts. 



119 



[17] Jan. 21 



Public Papers of the Presidents 



17 Statement by the President on the Rejection by the House of 
Representatives of the Korean Aid Bill. ]anuary 21, 1950 

I AM releasing herewith a letter which I 
have received from the Secretary of State 
about the action of the House of Representa- 
tives in rejecting the Korean aid bill on 
Thursday by a vote of 193 to 191. I entirely 
concur in the Secretary's views as to the 
seriousness of this action and the necessity 
for its speedy rectification. I shall take up 
this matter with congressional leaders and 
urge upon them the need for immediate 
action, in order that important foreign 
policy interests of this country may be prop- 
erly safeguarded. 



note: The letter of the Secretary of State, dated 
January 20, follows: 

"Dear Mr. President: 

"The Department of State received with concern 
and dismay the report that the House of Representa- 
tives had rejected the Korean Aid Bill of 1949 by a 
vote of 193 to 191. This action, if not quickly 
repaired, will have the most far-reaching adverse 
effects upon our foreign policy, not only in Korea 
but in many other areas of the world. It has been 
fundaniental to our policy that in those areas where 
a reasonable amount of American aid can make the 
difference between the maintenance of national inde- 
pendence and its collapse under totalitarian pressure, 
we should extend such aid within a prudent assess- 
ment of our capabilities. The American people 
understand this policy and have supported our ex- 
tending aid in such circumstances; the success of 
such aid is a matter of public record. 

"The Republic of Korea owes its existence in 
large measure to the United States, which freed the 
country from Japanese control. The peoples of the 
Republic of Korea, the other peoples of Asia, and 
the members of the United Nations under whose 
observation a government of the Republic was freely 
elected, alike look to our conduct in Korea as a 



measure of the seriousness of our concern with the 
freedom and welfare of peoples maintaining their 
independence in the face of great obstacles. We 
have not only given the RepubUc of Korea inde- 
pendence; since then we have provided the economic, 
military, technical, and other assistance necessary 
to its continued existence. Of the current program 
of economic assistance we are extending to Korea, 
half was provided by the Congress during the previ- 
ous session. The withholding of the remainder 
would bring our efforts to an end in mid-course. 
It is our considered judgment that if our limited 
assistance is continued the Republic will have a good 
chance of survival as a free nation. Should such 
further aid be denied, that chance may well be lost 
and all our previous efforts perhaps prove to have 
been vain. 

"We are concerned not only about the conse- 
quences of this abrupt about-face in Korea, whose 
government and people have made valiant efforts to 
win their independence and establish free institu- 
tions under the most difficult circumstances, but we 
are also deeply concerned by the effect which would 
be created in other parts of the world where our 
encouragement is a major element in the struggle 
for freedom. 

"It is difficult for us to believe that the Members 
of the House of Representatives who voted against 
this measure took sufficiently into account the serious 
implications of this action upon the position of the 
United States in the Far East. These implications 
were set forth in considerable detail in hearings 
before the committees of Congress by the Department 
of State, Department of Defense and the Economic 
Cooperation Administration. 

"In our judgment it would be disastrous for the 
foreign policy of the United States for us to con- 
sider this action by the House of Representatives as 
its last word on the matter. 
"Faithfully yours, 

"Dean Acheson" 

On February 14, 1950, the President approved 
the Far Eastern Economic Assistance Act of 1950 
(64 Stat. 5). 



18 Special Message to the Congress on Tax Policy. 
January 23, 1950 



To the Congress of the United States: 

The tax policy of the United States Gov- 
ernment is of major significance to the na- 



tional welfare. Taxes are the means by 
which our people pay for the activities of 
the Government which are necessary to our 



120 



Harry S. Truman, ig^o 



Jan. 23 [18] 



survival and progress as a nation. Decisions 
about Federal tax policy should be made in 
full recognition of the economic and budg- 
etary situation, and should contribute to our 
national objectives of economic growth and 
broader opportunity for all our citizens. 

At the present time, I believe we should 
make some revisions in our tax laws to 
improve the fairness of the tax system, to 
bring in some additional revenue, and to 
strengthen our economy. 

Our general objective should be a tax sys- 
tem which will yield sufficient revenue in 
times of high employment, production, and 
national income to meet the necessary ex- 
penditures of the Government and leave 
some surplus for debt reduction. In the 
Budget Message, I estimated that receipts in 
the fiscal year 1951 will fall short of meeting 
expenditures by 5.1 billion dollars. This 
deficit will be due largely to the shortsighted 
tax reduction enacted by the Eightieth Con- 
gress, and to the present necessity for large 
expenditures for national security and world 
peace. Moreover, owing to the time lag be- 
tween corporation earnings and tax pay- 
ments, the 1949 decline in corporation profits 
will be reflected in lower tax receipts in the 
fiscal year 1951. 

The policies I am recommending to the 
Congress are designed to reduce the deficit 
and bring about a budgetary balance as rap- 
idly as we can safely do so. These policies 
are threefold: first, to hold expenditures to 
the lowest level consistent with the national 
interest; second, to encourage and stimulate 
business expansion which will result in more 
revenue; and third, to make a number of 
changes in the tax laws which will bring in 
some net additional revenue and at the same 
time improve the equity of our tax system. 

First, as to Government expenditures. 

I have recently transmitted to the Congress 
a budget containing recommendations for 
appropriations and estimates of expenditures 



for the fiscal year 195 1. This budget was 
carefully prepared with a view toward hold- 
ing expenditures to the lowest possible levels 
consistent with the requirements of national 
security, world peace, economic growth, and 
the well-being of our people. 

The decisions of the Congress, as well as 
unpredictable changes in circumstances over 
the next eighteen months, may alter in many 
particulars the character and amount of the 
expenditures contemplated in this budget. 
Nevertheless, I believe the estimates con- 
tained in the budget represent the most 
realistic appraisal that it is possible to make 
at this time of the necessary expenditures in 
1 95 1. I believe the Congress will generally 
concur in this view after it has had an oppor- 
tunity to consider these estimates carefully. 

The expenditures estimated in the 1951 
budget have been reduced by about 900 mil- 
lion dollars below the level estimated for the 
present fiscal year. The policies recom- 
mended in the budget will permit further 
reductions in subsequent years as the cost of 
some of the extraordinary postwar programs 
continue to decline. 

To achieve these reductions we must con- 
tinue to practice rigid economy. At the 
same time, it would be self-defeating to 
cripple activities which are essential to our 
national strength. It will require wisdom 
and courage to find and hold fast to the 
course of wise economy without straying into 
the field of foolish budget slashes. 

Second, as to the strength and growth of 
our national economy. 

We cannot achieve and maintain a bal- 
anced budget without a strong and prosper- 
ous economy. A recession in economic ac- 
tivity would call for increased Government 
expenditures at the same time that revenues 
were reduced, thus creating greater budget 
deficits. 

At the present time, the economy of the 
United States is growing, and we have every 



41-355—65- 



-11 



121 



[i8] Jan. 23 



Public Papers of the Presidents 



reason to expect it to continue to expand if 
we follow the right policies. It is largely 
the task of private business to achieve this 
growth. The Government, however, can 
and should contribute to it. Through such 
cooperation, national employment and in- 
come will grow. This will result, in time, 
in increasing Government revenues. 

Just as the condition of our national econ- 
omy has an overriding effect upon our efforts 
to balance the budget, so do our policies for 
managing the Federal budget have a deci- 
sive effect upon the national economy. 
Drastic reductions in Federal expenditures 
in the wrong places and at the wrong time 
could have serious disruptive effects through- 
out our economy. 

Government revenue policies are as im- 
portant in our economy as Government ex- 
penditure policies. Events of the last few 
years have proved that our economy can 
grow and prosper, and that employment, 
production and incomes can increase, at the 
same time that individuals and businesses 
are paying taxes which are high by prewar 
standards. However, taxes can and do have 
an important effect upon business conditions 
and economic activity. It should be our 
constant objective to improve our tax system 
so that the required revenues can be obtained 
without impairing the private initiative and 
enterprise essential to continued economic 
growth. 

We should always keep in mind that the 
maintenance of a sound fiscal position on 
the part of the Government is a long-range 
matter. Nothing could be more foolhardy 
than to attempt to bring about a balanced 
budget in 195 1 by measures that would make 
it impossible to maintain a balanced budget 
in the following years. 

Third, as to changes in the tax laws. 

If, over the next few years, we hold ex- 
penditures to the minimum necessary levels 
and at the same time follow policies which 



contribute to stable economic growth, we 
can look forward to steady progress toward 
a balanced budget. Nevertheless, we should 
not rely only upon budgetary economy and 
upon economic expansion to produce a bal- 
anced budget. We should accelerate the 
attainment of this objective by changes in 
the tax laws. Drastic increases in tax rates, 
just as in the case of drastic cuts in essential 
expenditures, might prove to be self-defeat- 
ing. Our primary objective should be to 
improve and strengthen our revenue system 
for the long run. 

Under these circumstances, I am now rec- 
ommending a number of important revisions 
in our present tax system, to reduce present 
inequities, to stimulate business activity, and 
to yield about one billion dollars in net addi- 
tional revenue. 

In making changes in the tax laws, we 
should be sure they move toward, and not 
away from, the major principles of a good 
tax system. Our tax structure should rec- 
ognize differences in ability to pay; it should 
provide incentives to new undertakings and 
the expansion of existing businesses; it 
should support the objective of increasing 
opportunities for all our citizens to obtain a 
better standard of living; and it should 
rigidly exclude unfairness or favoritism. 

Over the years, we have made important 
progress in building a good tax system. 
However, much remains to be done. There 
is need further to improve the distribution 
of the tax load to make it conform better 
with tax paying ability. There is need to 
reduce taxes which burden consumption 
and handicap particular businesses. More- 
over, we should eliminate tax loopholes 
which enable some few to escape their share 
of the cost of government at the expense of 
the rest of the American people. 

Many of the important and desirable tax 
revisions which should be made must be 
postponed until the budget situation im- 



122 



Harry S. Truman, ig^o 



Jan. 23 [18] 



proves. Nevertheless, a number of those 
steps can and should be taken now. 

First, I recommend that excise taxes be 
reduced to the extent, and only to the extent, 
that the resulting loss in revenue is replaced 
by revenue obtained from closing loopholes 
in the present tax lav^s. 

The excise taxes are still at substantially 
their wartime levels. Some are depressing 
certain lines of business. Some burden con- 
sumption and fall with particular weight on 
low-income groups. Still others add to the 
cost of living by increasing business costs. 

Since we are limited in the amount of re- 
duction we can now afford, we should choose 
for reduction those taxes which have the 
most undesirable effects. I believe that re- 
ductions are most urgently needed in the 
excise taxes on transportation of property, 
transportation of persons, long-distance tele- 
phone and telegraph communications, and 
the entire group of retail excises, including 
such items as toilet preparations, luggage, 
and handbags. 

If these revisions are made, we will have 
reduced the most serious inequities of our 
present excise taxes. We should go further 
just as quickly as budgetary conditions per- 
mit. At present, however, we should reduce 
excises only to the extent that the loss in 
revenue can be recouped by eliminating the 
tax loopholes which now permit some groups 
to escape their fair share of taxation. 

The continued escape of privileged groups 
from taxation violates the fundamental 
democratic principle of fair treatment for 
all, and undermines public confidence in the 
tax system. While few of these loopholes 
by themselves involve major revenue losses, 
collectively they result in the loss of many 
hundreds of millions of dollars every year. 

I wish to call the attention of the Con- 
gress to the more important of these loop- 
holes. While some of them are of long 
standing, their injustice has been aggravated 



as the taxes assessed against the rest of the 
population have been increased. A tax con- 
cession to a favored few is always unfair, 
but it becomes a gross injustice against the 
rest of the population when tax rates are 
high. The case for the elimination of these 
inequities would be strong even if there were 
no need for replacement revenue. It is com- 
pelling when excise relief depends on it. 

I know of no loophole in the tax laws so 
inequitable as the excessive depletion ex- 
emptions now enjoyed by oil and mining 
interests. 

Under these exemptions, large percentages 
of the income from oil and mining properties 
escape taxation, year after year. Owners of 
mines and oil wells are permitted, after de- 
ducting all costs of doing business, to exclude 
from taxation on account of depletion as 
much as half of their net income. In the 
case of ordinary businesses, investment in 
physical assets is recovered tax-free through 
depreciation deductions. When the original 
investment has been recovered, a deprecia- 
tion deduction is no longer allowed under 
the tax laws. In the case of oil and mining 
businesses, however, the depletion exemption 
goes on and on, year after year, even though 
the original investment in the property has 
already been recovered tax free, not once but 
many times over. 

Originally introduced as a moderate meas- 
ure to stimulate essential production in the 
first World War, this special treatment has 
been extended during later years. At the 
present time, these exemptions, together with 
another preferential provision which per- 
mits oil-well investment costs to be imme- 
diately deducted from income regardless of 
source, are allowing individuals to build up 
vast fortunes, with litde more than token 
contributions to tax revenues. 

For example, during the five years 1943 to 
1947, during which it was necessary to col- 
lect an income tax from people earning less 



123 



[i8] Jan. 23 



Public Papers of the Presidents 



than $20 a week, one oil operator was able, 
because of these loopholes, to develop prop- 
erties yielding nearly $5,000,000 in a single 
year without payment of any income tax. 
In addition to escaping the payment of tax 
on his large income from oil operations, he 
was also able through the use of his oil tax 
exemptions to escape payment of tax on 
most of his income from other sources. For 
the five years, his income taxes totaled less 
than $100,000, although his income from 
non-oil sources alone averaged almost 
$1,000,000 each year. 

This is a shocking example of how pres- 
ent tax loopholes permit a few to gain enor- 
mous wealth without paying their fair share 
of taxes. 

I am well aware that these tax privileges 
arc sometimes defended on the grounds that 
they encourage the production of strategic 
minerals. It is true that we wish to encour- 
age such production. But the tax bounties 
distributed under present law bear only a 
haphazard relationship to our real need for 
proper incentives to encourage the explora- 
tion, development and conservation of our 
mineral resources. A forward-looking re- 
sources program does not require that we 
give hundreds of millions of dollars annually 
in tax exemptions to a favored few at the 
expense of the many. 

Some tax loopholes have also been de- 
veloped through the abuse of the tax exemp- 
tion accorded educational and charitable 
organizations. It has properly been the 
policy of the Federal Government since the 
beginning of the income tax to encourage 
the development of these organizations. 
That policy should not be changed. But the 
few glaring abuses of the tax exemption 
privilege should be stopped. 

Responsible educational leaders share in 
the concern about the fact that an exemption 
intended to protect educational activities has 
been misused in a few instances to gain com- 



petitive advantage over private enterprise 
through the conduct of business and indus- 
trial operations entirely unrelated to educa- 
tional activities. 

There are also instances where the exemp- 
tion accorded charitable trust funds has been 
used as a cloak for speculative business ven- 
tures, and the funds intended for charitable 
purposes, buttressed by tax exemption, have 
been used to acquire or retain control over 
a wide variety of industrial enterprises. 

These and other unintended advantages 
can and should be removed without jeop- 
ardizing the basic purposes of those orga- 
nizations which should righdy be aided by 
tax exemption. 

A problem exists also with respect to life 
insurance companies. The tax laws have 
always accorded favorable treatment to the 
income received by individuals from life 
insurance policies and have made special 
provision for the taxation of life insurance 
companies. As a result of a quirk in the 
present law, however, life insurance com- 
panies have unintentionally been relieved of 
income taxes since 1946. This anomalous 
situation has meant that neither the com- 
panies nor their policyholders have paid 
taxes on more than 1.5 billion dollars of 
investment income per year, derived from 
productive assets worth about 60 billion 
dollars. 

I understand that the Committee on Ways 
and Means of the House of Representatives 
has already undertaken to correct this situa- 
tion for the past years. I urge that steps also 
be taken to develop a permanent system for 
the taxation of life insurance companies 
which will remove the inequities of under- 
taxation in this field without impairing the 
ability of individuals to acquire life insurance 
protection. 

In addition to the tax loopholes I have 
described, there are a number of others 
which also represent inequities, and should 



124 



Harry S. Truman, ig^o 



Jan. 23 [18] 



be closed. Most of these permit individuals, 
by one device or another, to take unfair ad- 
vantage of the difference between the tax 
rates on ordinary income and the lower tax 
rates on capital gains. As one example, 
under present law producers of motion pic- 
tures, and their star players, have attempted 
to avoid taxes by creating temporary corpora- 
tions which are dissolved after making one 
film. By this device, their income from 
making the film, which ought to be taxed 
at the individual income tax rates, would be 
taxed only at the capital gains rate. Thus, 
they might escape as much as two-thirds of 
the tax they should pay. 

All these loopholes have been under joint 
study by the Treasury Department and the 
staff of the Congressional Joint Committee 
on Internal Revenue Taxation. A practical 
program which would go far toward closing 
these loopholes can be enacted during the 
present session of the Congress. This would 
be a substantial step toward increasing the 
fairness of our tax system, and should add 
several hundred million dollars to its yield — 
sufficient revenue to permit substantial excise 
tax reduction where it is most urgently 
needed. 

I wish to make it very clear that I could 
not approve excise tax reductions unless they 
were accompanied by provision for replace- 
ment of the revenue lost, because I am con- 
vinced that sound fiscal policy will not 
permit a weakening of our tax system at this 
time. Under present conditions, we cannot 
afford to reduce excise taxes first, in the 
hope that action will be taken later to make 
up for the loss in revenue. 

Second, I recommend that the Congress 
enact legislation to provide one billion dol- 
lars in additional revenue, by revising and 
improving the estate and gift tax and the 
corporation tax laws. I believe that, under 
present economic conditions, this amount of 
additional revenue represents a proper bal- 



ance between the objective of balancing the 
budget as soon as possible and the objective 
of coordinating tax adjustments with the 
requirements of continued prosperity. 

A substantial part of the additional rev- 
enue should be obtained from revision of the 
estate and gift tax laws. 

The Revenue Act of 1948 reduced the 
yield of the estate and gift taxes by one-third, 
or nearly 300 million dollars. Even before 
that Act, estate and gift tax yields were out 
of line with other revenues, and that Act 
made the situation worse. 

In originally enacting the estate tax in 
19 1 6, the Congress pointed out that "our 
revenue system should be more evenly and 
equitably balanced" and that a "larger por- 
tion of our necessary revenues" should be 
collected from the "inheritances of those 
deriving most protection from the Govern- 
ment." Our estate and gift tax laws at 
present fall far short of this objective. They 
now produce less than 2 per cent of internal 
revenues, compared with 7 per cent ten years 
ago. To the extent that these taxes remain 
too low, the remainder of our tax structure 
must bear a disproportionate load. 

The low yield from the estate and gift 
taxes is due to serious weaknesses in the 
present law. 

These weaknesses include excessive ex- 
emptions, unduly low effective rates on most 
estates, and the fact that the law as written 
favors large estates over smaller ones, and 
leaves substantial amounts of wealth com- 
pletely beyond the reach of the tax laws. 
Large fortunes may be transmitted from one 
generation to another free of estate or gift 
tax through the use of life estates. By this 
means, vast accumulations of wealth may 
completely escape tax over several genera- 
tions. 

Furthermore, the present law affords ex- 
cessive opportunities for tax reduction by 
splitting between the gift and estate taxes 



125 



[i8] Jan. 23 



Public Papers of the Presidents 



the total amount of wealth transferred by an 
individual. This makes the tax liability 
depend, not upon the amount of wealth 
which an individual leaves to his family, but 
upon the manner in which he arranges the 
disposition of his wealth. If a man leaves 
his estate of $300,000 at death, one-half to 
his wife and one-half to his three children, 
an estate tax of $17,500 must be paid. If 
his equally well-to-do neighbor gives away 
$180,000 to his wife and three children over 
a 5-year period and leaves them the other 
$120,000 at death, no estate or gift tax what- 
ever is paid. This difference in tax, whether 
it depends upon fortuitous circumstances or 
the caliber of legal counsel, is obviously 
unwarranted. 

To strengthen the estate and gift tax laws, 
several steps are necessary. The laws con- 
cerning the taxation of transfers by gift and 
by bequest, by outright disposition and 
through life estates, need to be coordinated 
to provide uniform treatment and a base for 
more effective taxation. In addition, the 
present exemptions should be reduced and 
the rates should be revised. These changes 
will not only bring in more revenue, but they 
will also improve the fairness of the estate 
and gift tax laws and bring these taxes nearer 
to their proper long-term place in our tax 
system. 

The rest of the additional revenue should 
be obtained from adjustments in the corpo- 
ration income tax. At the same time, certain 
improvements should be made in this tax. 

I recommend a moderate increase in the 
tax rate applicable to that part of a corpora- 
tion's income which is in excess of $50,000. 
At the same time, I recommend that the tax 
rate on corporate income between $25,000 
and $50,000, which is now taxed at the ex- 
cessively high "notch" rate of 53 per cent, be 
reduced to the same rate that applies above 
$50,000. 



These changes in the tax rate structure 
would go far toward removing the handicaps 
which the present law places upon the expan- 
sion of small corporations. The removal of 
the excessive "notch" rate would reduce the 
taxes paid by medium-sized corporations 
whose continued growth is so essential to the 
dynamic expansion of our economy. The 
existing favorable tax rates for small corpo- 
rations with incomes below $25,000 would 
be retained. The tax increase would be con- 
fined to less than one-tenth of all corpora- 
tions. 

Furthermore, I recommend that the loss 
carry-forward provision be extended from 
two to five years to provide more scope for 
offsetting losses of bad years against profits 
of subsequent years. This extension will give 
increased incentive to business investment 
affected by uncertain profit expectations. It 
will be particularly helpful to new businesses 
which, under the present provision permit- 
ting losses to be carried forward only two 
years, may be required to pay taxes over a 
period of several years during which they 
actually suffer a net loss. 

At the same time that we make these 
changes in the tax laws to stimulate invest- 
ment at home, we should make certain 
changes in the tax laws concerning income 
derived from foreign investments and per- 
sonal services abroad. This would provide 
significant support to our efforts to extend 
financial and technical assistance to under- 
developed regions of the world. 

Among the steps which should be taken 
at this time are to postpone the tax on cor- 
porate income earned abroad until it is 
brought home, to extend and generalize the 
present credit for taxes paid abroad, and to 
liberalize the foreign residence requirement 
for exemption of income earned abroad. 
These changes, together with the safeguards 
for our investors which we are in the process 



126 



Harry S. Truman, i^^o 



Jan. 24 [19] 



of negotiating with foreign governments, 
will provide real stimulation for the expan- 
sion of United States investment abroad. 



The tax program I am recommending is 
designed to strengthen our tax system so that 
it will yield revenues sufficient to balance 
expenditures as they are further reduced over 
the next several years, and to provide some 
surplus for debt reduction. Because of the 
time lag in collecting taxes after their enact- 
ment, these recommendations will not result 
in any substantial increase in receipts in the 
fiscal year 195 1, but they will result in larger 
revenues in subsequent years and, at the 
same time, substantially improve the struc- 
ture of our tax system for the long run. 

A sharp increase in taxes under present 
economic conditions would be unwise. 
However, in line with the policy of gearing 



changes in revenue laws to the needs of our 
economy, I would not hesitate, if strong 
inflationary or deflationary forces should 
appear, to support the use of all measures 
necessary to meet the situation, including 
more pronounced adjustment of tax rates up- 
ward or downward, as the case might be. 
We have come through the war and a 
difficult transition period with the financial 
strength of our Government maintained and 
an economy producing far above prewar 
levels. We should continuously seek to sus- 
tain and improve these indispensable foun- 
dations for progress. The tax program I am 
recommending is an important and necessary 
means to that end. 

Harry S. Truman 

note: On September 23, 1950, the President ap- 
proved the Revenue Act of 1950 (64 Stat. 906). 



19 Statement by the President on the New 75-Cent 
Minimum Wage Rate. January 24, 1950 



AT MIDNIGHT tonight the lot of a great 
many American workers will be substan- 
tially improved. 

Today the minimum wage is 40 cents an 
hour. Tomorrow the new 75-cent mini- 
mum rate goes into effect for the 22 million 
workers who are protected by the Fair Labor 
Standards Act, our Federal wage-hour law. 
Another amendment to that law will provide 
gready increased protection for our young 
boys and girls against dangerous industrial 
work. 

This legislation, passed by the 8ist Con- 
gress at its first session, is an important addi- 
tion to the laws we live by. It is a measure 
dictated by social justice. It adds to our 
economic strength. It is founded on the 
belief that full human dignity requires at 
least a minimum level of economic sufficiency 
and security. 



For many generations we have recognized 
that there are legitimate roles for the Gov- 
ernment to play in protecting our people 
from economic injustice and hardship. Our 
Founding Fathers explicidy stated this. In 
the Preamble to the Constitution of the 
United States, it is declared that this Gov- 
ernment was established, among other rea- 
sons, to "promote the general welfare." 

Until 1933 ^^ objective of providing for 
the general welfare had been implemented 
primarily through State and Federal legisla- 
tion to foster and protect business enterprise. 
There had been few successful attempts be- 
fore 1933 to protect our people as individuals. 
Even the first Federal attempt to provide a 
floor under wages in various industries failed 
when the National Industrial Recovery Act 
was declared unconstitutional in 1935. 

We felt, however, that a government 



127 



[ip] Jan. 24 



Public Papers of the Presidents 



which could, for example, protect business 
from the unfair competition of monopolistic 
practices was not powerless to protect the 
individual from the social and economic 
evils of low wages. Therefore, we enacted, 
in 1938, a Federal wage-hour law. In so 
doing, we declared our purpose to eliminate 
from the channels of commerce all competi- 
tion based on labor practices detrimental to 
the health and well-being of the Nation's 
workers. 

Three basic provisions were written into 
the statute to achieve that goal. The law 
set a firm floor under wages. This meant 
that a man would no longer need relief 
money for food after he worked a full week. 
Then the law encouraged the spreading of 
employment by requiring overtime pay after 
a man worked 40 hours. No longer would 
one man toil 60 or 70 hours a week while 
another man was looking for a job. The 
law also sought to prevent the employment 
of boys and girls under 16 in industry. No 
longer was the world of tomorrow to be 
endangered by impairment of the health 
and curtailment of the educational oppor- 
tunities of the youth of today. 

This law was a great achievement. It had 
a highly beneficial effect upon our entire 
economy. Despite the prophesies of dis- 
aster, this law did not hurt business. On 
the contrary, it helped all segments of our 
population. When the test came, employers 
who had feared they could not stay in busi- 
ness under the law found, in fact, that they 
could successfully meet its requirements. 
The law added to the purchasing power of 
our lowpaid workers, and by encouraging 
the spreading of work put more people on 



payrolls. This law thus gave great impetus 
to the revival of our economy. 

As our economy changed and developed, 
however, it became apparent that the floor 
we had placed under wages would no longer 
serve as real protection to our workers or to 
those employers who were paying fair wages. 
As I stated to the Congress, the 40-cent mini- 
mum wage became obsolete. 

Ours is a growing society. We cannot 
afford to stand still, and we cannot afford to 
have our legislation become outmoded. 
Consequently, in 1949 we reexamined and 
reappraised the Federal wage-hour law in 
the light of the 1 1 years' experience we had 
had with it and in the context of our present 
$250 billion national economy. The amend- 
ments to the act, which go into effect at 
midnight tonight, constitute our moderniza- 
tion of this law. 

As now amended, the Fair Labor Stand- 
ards Act is a good law. But no law can be 
drafted which will not need reexamination 
in the light of subsequent developments. 
I have therefore asked the Secretary of Labor 
to keep me informed on the operation of the 
new law. I am confident that our employers 
and workers will find compliance with this 
law even easier than compliance with the 
original statute in 1938. I look forward to 
great and lasting benefits from this legisla- 
tion. 

Our progress in this field points the way 
for our future action. We shall not relax in 
our efforts to provide a better life for all our 
people. 

note: The Fair Labor Standards Amendments of 
1949 was approved on October 26, 1949 (63 Stat. 
910). For the President's statement upon signing 
the bill see 1949 volume, this series, Item 239. 



128 



Harry S. Truman, jgp 



Jan. 26 [21] 



20 Exchange of Messages With President Prasad of India. 
January 26, 1950 



ON THIS memorable day in India's history, 
I send my greetings and best wishes and 
those of the people of the United States to 
you, and through you to the people of the 
Union of India. The establishment of the 
sovereign independent republic of India 
within the Commonwealth represents a final 
step in India's political transition which 
closely parallels the political evolution of our 
own country. Because of our traditional 
sympathy with India, the people of the 
United States are particularly happy to send 
expressions of good will on this occasion. 

The inauguration of India's new form of 
government and of its new Constitution, and 
the assumption of office by the first Presi- 
dent, constitute an auspicious beginning of 
the second half of the Twentieth Century. 
May the future of the new republic, func- 
tioning under its democratic Constitution, 
be characterized by peace, prosperity and 
good fortune. 

Harry S. Truman 



[His Excellency, The President of the Union of 
India, New Delhi] 

note: President Prasad's message follows: 

On behalf of the people of the Republic of India, 
I desire to thank you, Mr. President, and through 
you the people of the United States of America for 
your greetings and wishes on this historic occasion. 
The inauguration of the Republic is a conspicuous 
landmark in the long and eventful history of our 
country in the struggle for our independence. 

We have always had the sympathy and under- 
standing of the people of the United States of 
America. During the last two years the relations 
between our two countries have become closer 
through exchange of Ambassadors and the visit of 
my Prime Minister last autumn to the United States. 
As first President of the Republic of India it shall 
be my constant endeavour to uphold the traditions 
of democratic government and to foster, together 
with other like-minded nations, the ideals of peace 
and moral law that we have inherited from the 
Father of our Nation, Mahatma Gandhi. In this 
task, I am sure we can count on the cooperation of 
the Government and people of the United States, 
whose principles of individual liberty and the rule 
of law are reflected in the provisions of our own 
Constitution. 

Rajendra Prasad 



21 Remarks to the Women's Patriotic Conference on 
National Defense. January 26, 1950 



Madam President and ladies and gentlemen: 
It is a very great pleasure for me to have 
the privilege of being here tonight. I wish 
I could have been here for the v^hole eve- 
ning, but this has been quite a busy day for 
me. Every day is, for that matter. You 
know, I spend most of my time urging peo- 
ple to do what they ought to do without 
being urged. That is what is called the 
power of the President. His powers are 
mostly public relations. He is elected the 
President of the United States, and he is the 
only member of the Government who is 
elected at large, except the Vice President; 



and the Vice President is elected along with 
him. 

But the Vice President, as Mr. Dawes once 
said, has only two duties: one is to preside 
over the Senate, and the other one is to in- 
quire about the President's health. The 
Vice President and I spent many happy 
hours in the Senate, and he presides over the 
Senate, and he is not a bit interested in the 
health of the President. 

I had an experience today that is rather 
unusual. One of my closest friends, the 
mayor of Independence, Mo., passed away 
on Tuesday night very suddenly, from a 



41_3,5,5_65- 



-12 



129 



[2i] Jan. 26 



Public Papers of the Presidents 



heart attack. He and I were raised together 
in our hometown. He is 5 or 6 years 
younger than I am — or was. We were in 
the First World War together. He started 
out as the commanding officer of C Battery 
from Independence. At Camp Doniphan he 
was made commander of A Battery. After 
that he was made regimental adjutant of my 
regiment of field artillery and he was in that 
position until the war was over. 

He has been mayor of Independence since 
1924, when he was elected to that office. He 
was elected to that office when I was in my 
first elective oflSce. The returned soldiers 
in that town, with my cooperation and help, 
made him mayor. He was a great mayor of 
that great city. And I was most anxious to 
be present to pay my respects to his passing, 
but conditions were such here in Washing- 
ton that I had to stay here and discuss things 
that aflected the whole Nation all morning 
this morning. 

And then this afternoon, the daughter of 
another one of my closest friends was mar- 
ried, and I was present at that ceremony. 
That young lady I remember when she was 
like this — along with my daughter. She is 
younger than my daughter, but I won't give 
away her age. 

That brings home to me that here are the 
young people ready to take up for the coun- 
try, and here are those of us who have passed 
the threescore mark, passing on to the next 
world, leaving it to the younger people. 

I have but one ambition as President of 
the United States, and that is to see peace in 
the world, and a working, efficient United 
Nations to keep the peace in the world. 
Then I shall be willing to do what my mayor 
did, pass on happily so that some able, 
younger man may carry on the work neces- 
sary to keep this Government going. 

You know we have the greatest govern- 
ment in the world. I understand that this 
is a meeting of the patriotic women of the 



United States. Patriotic means "father," 
and patriotic means that you are working to 
carry on for the benefit of your father — 
carrying on for the benefit of your country. 
And when you carry on for the benefit of 
the only country in the world whose interest 
is the welfare of all the people in the world, 
you can't help but do what is right. 

There is no difference in totalitarian states, 
they are all just alike. They believe in gov- 
ernment for the few and not for the welfare 
of the many. Our Government is founded 
on the theory that government is for the 
welfare of the whole people and not for just 
a few at the top. 

I believe that sincerely. I have made quite 
a study of government. I have had quite a 
lot of experience in governmental affairs. 
In fact, I have been in it for about 30 years, 
more or less, and my viewpoint has not 
changed. 

I think the Constitution of the United 
States is the greatest document of govern- 
ment that the history of the world has ever 
seen, and I expect to devote the rest of my 
life, if the Lord is good to me, to upholding 
and supporting that article of government. 

When we do that, we will support the 
United Nations and we will support the 
welfare of all the people in the world. And 
eventually we will have permanent peace. 
That is all I live for. 

Thank you very much. 

note: The President spoke at 10 p.m. at the Statler 
Hotel in Washington. His opening words "Madam 
President" referred to Mrs. Norman Sheehe, national 
president of the American Legion Auxiliary. In 
the course of his remarks he referred to Roger T. 
Sermon, former Mayor of Independence, Mo., and 
Edith Cook (Drucie) Snyder, daughter of the Secre- 
tary of the Treasury and Mrs. John W. Snyder, who 
was married that day to Maj. John E. Horton, 
former White House aide, at the National Cathedral 
in Washington. 

The conference was composed of 35 different 
women's patriotic organizations from throughout 
the United States. 



130 



Harry S. Truman, ig^o 



Jan. 27 [22] 



22 Statement by the President Upon Issuing Order Providing for the 
Administration of the Mutual Defense Assistance Act. 
January 27, 1950 

the $1 billion in funds and contract author- 
ity made available for assistance in the North 
Adantic area can only be utilized after I 
approve recommendations for an integrated 
defense of the North Adantic area made by 
the Council and the Defense Committee 
established under the North Atlantic Treaty. 
Finally, as a condition precedent to the fur- 
nishing of assistance to any country, the 
recipient must have entered into an agree- 
ment v^^ith the United States embodying cer- 
tain commitments concerning its use. 

Prior to the effective date of the law, the 
Department of State received requests for 
military assistance from the follov^ing North 
Adantic Treaty countries: Belgium, Den- 
mark, France, Italy, Luxembourg, the 
Netherlands, Norway, and the United 
Kingdom. 

The North Atlantic Defense Committee, 
at its meeting in Paris on December i, 1949, 
agreed unanimously on recommendations 
made by the Military Committee for the 
integrated defense of the North Adantic 
area, and the North Atlantic Council 
unanimously approved these recommenda- 
tions on January 6, 1950. Subsequendy, the 
Secretary of State and the Secretary of De- 
fense recommended that I approve them. 

I have today approved these recommenda- 
tions as satisfying the pertinent provisions of 
the Mutual Defense Assistance Act of 1949. 

I have approved them because I am satis- 
fied that they provide for the accomplish- 
ment of an integrated defense of the North 
Atlantic area. They do this by providing 
for a common defense based on the coopera- 
tive use of national military resources and 



DURING the past 2 years the free nations 
of Europe, with the help of the United States, 
have made great strides toward recovery. 
An essential element in this program has 
been the establishment of conditions in 
Western Europe adequate to give confidence 
to the people and to insure a reasonable pros- 
pect that the fruits of their labor would not 
be immediately lost in the event of aggres- 
sion. 

It was realized that an adequate secu- 
rity arrangement could be organized only 
if the free nations of Western Europe joined 
together and strengthened their individual 
and collective defense through self-help and 
mutual aid and if the United States joined 
in the collective enterprise. In recognition 
of this fact, the North Atlantic Treaty was 
signed on April 4, 1949. Further, in recog- 
nition of the concept of self-help and mutual 
aid embodied in article 3 of the treaty, I 
asked the Congress to authorize the furnish- 
ing of military assistance to certain of its 
signatories. At the same time I requested 
authorization to furnish military assistance 
to certain other free nations. 

In response to my request, the Congress 
passed the Mutual Defense Assistance Act of 
1949 on October 6, 1949. Under its pro- 
visions I am authorized to furnish military 
assistance to certain foreign countries which 
meet the specific conditions prescribed in 
the law. In the case of parties to the North 
Adantic Treaty, three such conditions are 
imposed. In the first place, to be eligible 
for assistance, the country must have re- 
quested such assistance prior to the effective 
date of the law. Secondly, $900 million of 



131 



[22] Jan. 27 



Public Papers of the Presidents 



on individual national specialization. They 
contain agreement that these resources, in- 
cluding United States military assistance, 
will be used with maximum efficiency and 
will not be used to develop separate and 
unrelated defenses. 

The North Atlantic Treaty is, in itself, a 
deterrent to aggression. I believe that these 
recommendations which have been agreed 
to by the governments of the North Atlantic 
Treaty nations constitute a major achieve- 
ment under the treaty. They provide fur- 
ther convincing evidence of the determina- 
tion of these nations to resist aggression 
against any of them and are a definite indica- 
tion of the genuine spirit of cooperation 
among the treaty members. 

The Mutual Defense Assistance Act of 
1949 also provided that the United States 
should conclude agreements with the coun- 
tries which request, and are to receive, mili- 
tary assistance. Such agreements are being 
signed today by the Secretary of State and 
(representatives of Belgium, Denmark, 
France, Italy, Luxembourg, the Netherlands, 
Norway, and the United Kingdom. Their 
texts will be made public and they will be 



registered with the United Nations. 

In view of these significant developments, 
I have today also made formal provision for 
the administration of the Mutual Defense 
Assistance Act by issuing an Executive order 
authorizing the Secretary of State to proceed 
with the program in consultation with the 
Secretary of Defense and the Administrator 
for Economic Cooperation. 

These developments are the result of close 
cooperation among free nations which in- 
tend to remain free. They are, of course, 
first steps. The successful implementation 
of the North Atlantic Treaty will require 
constant and continuing effort and coopera- 
tion by all its members. Planning for de- 
fense cannot be static. It must be constantly 
reviewed and revised in the light of chang- 
ing circumstances and it must be flexible to 
allow for maximum coordination of effort at 
all times. 

note: The President referred to Executive Order 
10099 "Providing for the Administration of the 
Mutual Defense Assistance Act of 1949" (Jan. 27, 
1950; 3 CFR, 1 949-1 953 Comp., p. 295). 

The Mutual Defense Assistance Act of 1949 v^^as 
approved on October 6, 1949 (63 Stat. 714). For 
the President's statement upon signing the act see 
1949 volume, this series, Item 225. 



23 The President's News Conference of 
January 27, 1950 



THE PRESIDENT, [i.] Well, Mr. ClifiEord 
will quit as Special Counsel to the President 
on Tuesday night at midnight. And Mr. 
Murphy will be sworn in the next morning, 
the 1st of February. There will be an ex- 
change of letters available for you when you 
go out, all mimeographed. 

That's the only announcement I have to 
make. 

[2.] Q. Mr. President, regardless of the 
outcome in the upper courts, will you or will 



you not turn your back on Alger Hiss.f* ^ 

THE PRESIDENT. No commeut. 

Q. Mr. President 

THE PRESIDENT. That's a nice question! 
What's that? 



^On January 25, 1950, Alger Hiss, former State 
Department official, v^^as sentenced by a United States 
District Court to 5 years in a Federal penitentiary 
for perjury. According to the New York Times, 
Secretary of State Dean Acheson told reporters at 
his news conference on January 25, "I do not intend 
to turn my back on Alger Hiss." 



132 



Harry S. Truman, ig^o 



Jan. 27 [23] 



[3.] Q. Do you favor reducing the 25 
percent excise tax placed on cameras and 
photographic equipment, which kept people 
from buying them during the war? 

THE PRESIDENT. What's that? Didn't you 
read my message on excise taxes? ^ 

Q. It is not mentioned. 

THE PRESIDENT. You had better read that 
message over again and your question will 
be answered. 

Q. It was not mentioned in there, sir. 

THE PRESIDENT. Well, read the message 
over again. Read it 

[4.] Q. Mr. President, is there any point 
in asking any other Alger Hiss questions? 

THE PRESIDENT. No, there is no point in 
asking any other Alger Hiss questions. 

Q. I was trying to get away from that 

THE PRESIDENT. They are not asked with 
good intent, and I don't intend to answer 
with good intent. [Laughterl 

Q. Does that go for "red herring" ques- 
tions? 

THE PRESIDENT. No questious on that, 
either. 

Q. Po you approve Secretary Acheson's 
statement? 

THE PRESIDENT. No COmmCUt. 

[5.] Q. Mr. President, have Mike 
Kinney and Barney Dickman been in to see 
you? ^ 

THE PRESIDENT. Mike Kiuuey is sitting 
right here now. I saw Barney Dickman 
yesterday. 

Q. Did they talk about the Allison candi- 
dacy? * 

THE PRESIDENT. Well, they probably will, 
when they get around to it, because that is 
what they always come to see me about. 

Q. There is a story printed in St. Louis 
that you are rather angry with Governor 

^ See Item 18. 

® Michael Kinney, Missouri State Senator, and 
Barnard F. Dickman, Postmaster for St. Louis, Mo. 
*See Item 3 [8]. 



Forrest Smith, and attribute the present 
political agitation in the State against the 
Allison candidacy 

THE PRESIDENT. No. No word of tHith in 
that at all. I had a telephone conversation 
with the Governor just the day before yes- 
terday, and we are on the friendliest of terms. 

Q. Was it on the Allison matter? 

THE PRESIDENT. No, it was on another 
matter. 

[6.] Q. Mr. President, have you any 
comment on a speech made in New York 
City last night by Senator Byrd,^ in which 
he charged that the administration is leading 
the country to socialism? 

THE PRESIDENT. That's a funny one, sure 
enough. 

[7.] Q. Mr. President, do you plan any 
action in the coal case? 

THE PRESIDENT. No commeut. 

[8.] Q. Mr. President, there has been 
some considerable discussion recendy — ^last 
week — of a possible compromise on FEPC 
along voluntary lines. Would you entertain 
such an idea of compromise 

THE PRESIDENT. My ideas on FEPC have 
been very clearly set out, and I would advise 
you to read that message.^ 

[9.] Q. Mr. President, what are you 
planning to do about Representative 
Patman's request that you impose a quota on 
oil imports? ^ 

THE PRESIDENT. The Congressman was in 

^The text of the address delivered by Senator 
Harry Flood Byrd of Virginia before the National 
Industrial Conference Board in New York City on 
January 26 is printed in the Congressional Record 
(vol. 96, p. A812). 

'See 1948 volume, this series, Item 20. 

^Representative Wright Patman of Texas, Chair- 
man of the House Small Business Committee, met 
with the President at the White House on January 
26. At that time Congressman Patman gave the 
President a report from the Committee calling for 
quota restrictions to be imposed on foreign oil im- 
ports, contending that they were damaging the 
domestic oil industry. 



133 



[23] Jan. 27 



Public Papers of the Presidents 



to see me, and discussed the matter. We 
are working on the situation. 

[10.] Q. Mr. President, we have reports 
from one newspaper that Ambassador Doug- 
las is very ill and will not be continued in 
the Ambassadorship even if he recovers 

THE PRESIDENT. I cau scotch that one just 
as easy as pie. The Ambassador is recover- 
ing rapidly, and he will be back in England 
inside the next 60 days. 

[11.] Q. Mr. President, Ambassador 
Capus Waynick says he talked North Caro- 
lina politics with you the other day. I 
wonder if you would like to see him in the 
Senate? 

THE PRESIDENT. I told you once that I was 
not interested in dabbling in the primaries 
of any other State outside of Missouri. That 
is a North Carolina matter which they will 
have to settle themselves. 

[12.] Q. Mr. President, when Justice 
Roberts' Atlantic Union group came in to 
see you,^ did you endorse that group as op- 
posed to any other group seeking generally 
the same objectives? 

THE PRESIDENT. No. 

Q. You had no endorsement 

THE PRESIDENT. No. 

Q. He said so, but there has been some 
question 

THE PRESIDENT. The Judge and his group 
were in here, and as usual we had a very 
pleasant visit together, and I thanked them 
for making a contribution toward helping 
the United Nations work more efficiendy. 

[13.] Q. Mr. President, have you any 
comment on the suggested compromise by 

®On January 20, former Supreme Court Justice 
Owen J. Roberts, president of the Atlantic Union 
Committee, headed a delegation of the Committee 
which called on the President at the White House. 
Their purpose in seeing the President was to urge 
him to support the proposed convocation of a Fed- 
eral convention of the democracies signatory to 
the North Atlantic Pact to explore the possibility 
of union between them. 



Senator Russell on civil rights? ® 

THE PRESIDENT. I dou't kuow anything 
about that compromise. My compromise is 
in my civil rights message. 

[ 14.] Q. Mr. President, in the last 2 days 
one House member of the Joint Congres- 
sional Atomic Energy Committee, and today 
one elder statesman, have spoken out publicly 
on the question of a super bomb. There 
have also been many columns written on the 
subject. Is there anything authoritative that 
you could give the American people on the 
subject? 

THE PRESIDENT. No, there isn't, and I don't 
think anybody else has had anything au- 
thoritative. I make that decision and no- 
body else. 

Q. Is there anything you could tell us as 
to when the decision might be made? ^° 

THE PRESIDENT. No, there is not. 

[15.] Q. Mr. President, is Mr. Lilien- 
thal's successor chosen yet? He told us this 
morning that there was no change in his 
plans to leave on the 15th of February. 

THE PRESIDENT. His successor has not been 
chosen. Whenever I get to the point where 
I can announce it, you will have it right away. 

Q. Mr. President, is another member of 
the Commission resigning? 

THE PRESIDENT. Not that I kuOW of .^^ 



®On January 25, several southern Democratic 
congressional leaders met to plan their strategy in 
dealing with the civil rights bill. After the meeting 
the New York Times reported that a compromise 
might be proposed containing the following provi- 
sions: that the FEPC program be put on a voluntary 
basis, that the antilynching legislation require proof 
by the Government that in such mob action there 
had been collusion between the mob and the law 
officers, and that the poll tax be repealed only by a 
constitutional amendment. 

^^See Item 26. 

^On February 7, 1950, the White House released 
the text of the President's letter accepting the resig- 
nation of Lewis L. Strauss as a member of the Atomic 
Energy Commission. The text of Mr. Strauss' letter 
was released with the President's reply. The resig- 
nation became effective April 15, 1950. 



134 



Harry S. Truman, ig^o 



Jan. 27 [24] 



[16.] Q. Mr. President, Mr. Boyd, head 
of the Bureau of Mines, has said that there 
was or would be, possibly soon, a nationwide 
emergency in coal. Have you received that 
report yet? ^^ 

THE PRESIDENT. Yes, I have received the 
report, and read it very carefully. 

Q. Are you going to do anything about it? 

THE PRESIDENT. No Comment. 

[17.] Q. Mr. President, are we likely to 
try again for an international control agree- 
ment on atomic weapons on the basis of the 
hydrogen bomb, in the United Nations? 

THE PRESIDENT. I cau't commeut on that. 
I am doing everything I possibly can to get 
the international control of atomic energy. 
I have been working at it ever since I became 
President. 

[18.] Q. Mr. President, have you any 



^The report was in the form of a letter from 
James Boyd, Director of the Bureau of Mines, to 
Oscar L. Chapman, Secretary of the Interior. The 
letter, dated January 20, 1950, stated that there were 
40 million tons of coal on hand on January i and that 
the danger point of 25 days of overall supply in the 
hands of consumers was rapidly approaching. 

The report concluded that "if it had not been for 
the two 2-day weeks during the holidays and the 
wildcat strikes during the past 3 weeks, it is esti- 
mated that an additional 9 to 10 million tons would 
have been available. The tonnage might well have 
been the balancing point that would have kept days 
supply above the danger point." 



comment on what Mr. McCloy calls the 
creeping blockade of Berlin? ^^ 

THE PRESIDENT. No commeut. 

[19.] Q. Mr. President, does your an- 
swer on those two civil rights questions mean 
that you would not entertain a compromise? 

THE PRESIDENT. I suggest that you read my 
message, and that sets out exactly what I 
want in civil rights. That's all the com- 
ment I expect to make on it. 

[20.] Q. Mr. President, how soon do you 
feel you will be able to announce the new 
member for the National Labor Relations 
Board? 

THE PRESIDENT. I Can't tell you. I am tak- 
ing plenty of time on that, because I am go- 
ing to get the man I want before I make the 
appointment. 

Q. Mr. President, is Mr. Styles the man? 

THE PRESIDENT. No.^* 

Reporter: Thank you, Mr. President. 
THE PRESIDENT. You'rc welcomc. 

note: President Truman's two hundred and four- 
teenth news conference was held in his office at the 
White House at 4:05 p.m. on Friday, January 27, 
1950. 

" On January 22 the Russian border guards at the 
checkpoint at Helmstedt, Germany, began requiring 
that all allied vehicles obtain clearances before pro- 
ceeding on the Autobahn connecting Berlin and the 
western zones of Germany. 

^* See Item 29 [i]. 



24 Letter Accepting Resignation of Clark M. Clifford as Special 
Counsel to the President. January 27, 1950 



Dear Clar\: 

I have now to take a step which from the 
bottom of my heart I wish could be indefi- 
nitely deferred. In acquiescing in your 
wishes I am moved by circumstances with 
which I have long been familiar. Reluc- 
tantly, therefore, and with deep regret I ac- 
cept, effective at the close of business on next 
Tuesday, January thirty-first, the resignation 



which you tender in your letter of January 
twenty-sixth. 

It would be difficult to overstate the value 
of the services which you have rendered 
your country. Before you undertook your 
arduous tasks at the White House four years 
ago you had met your war obligation by over 
two years of service in the Navy. 

Through six years of public service — ^and 



135 



[24] Jan. 27 



Public Papers of the Presidents 



those potentially among the most fruitful of 
your professional life — you have devoted 
your talents and superb abilities exclusively 
to your country's welfare. That is a long 
time for you to be away from the practice 
of the law. The urgency of your need to 
return is readily understood. 

For all that you have given we owe you 
a debt impossible to pay. You had much to 
contribute as Special Counsel to the Presi- 
dent because you brought to your work such 
great resources of legal learning and experi- 
ence as a practicing lawyer. Besides this you 
had foresight and courage. Your reports on 
the various problems on which I asked for 
your advice were models of lucidity and 
logic. In the marshaling and presentation of 
facts your method reflected your days before 
the jury. Quick in the detection of spurious 



evidence and alert always in detecting the 
fallacious in the arguments of our opponents, 
your final opinions were always models of 
brevity and accuracy, as well as clarity and 
strength. 

I shall miss you — we shall all miss you. 
My regret at your departure is tempered by 
the knowledge that you are to remain in 
Washington and the assurance that I can call 
upon you as occasion requires. In going you 
carry with you every assurance of my per- 
sonal gratitude and appreciation. You have 
also earned the thanks of the Nation which 
you have served so selflessly. 
Sincerely, 

Harry S. Truman 

note: Mr. Clifford served as Special Counsel to the 
President from July i, 1946, through January 31, 
1950. His letter of resignation, dated January 26, 
was released with the President's reply. 



25 Letter to the President of the Senate and to the Speaker of the 
House on U.S. Assistance to Palestine Refugees. 
January 30, 1950 

measures to reintegrate the Palestine refu- 
gees into the economic life of the area. Its 
recommendations are an example of the kind 
of development and planning which is es- 
sential to the economic grov^^th and improve- 
ment of underdeveloped areas. The Mission, 
in this survey, has taken into account the 
human and natural resources of the region 
in which these refugees find themselves, and 
has recommended a program of economic 
activity which will be of lasting benefit to 
these areas and to the standard of living of 
peoples who live there. 

Our aid is needed to put this program into 
effect and to help the Refugees and the in- 
habitants of these areas in the Middle East 
to achieve greater productivity through the 
steps recommended in the report of the 
Mission. 

In my inaugural address, I stressed the 



Dear Mr, : 

I am transmitting herewith for the con- 
sideration of the Congress a draft of pro- 
posed legislation to enable the United States 
to participate in and contribute to the United 
Nations Relief and Works Agency for Pales- 
tine Refugees in the Near East. This Agency 
has been established by the General Assem- 
bly of the United Nations to deal with the 
problems created by the displacement of 
hundreds of thousands of persons as a result 
of the recent hostilities in Palestine. 

The work of the Agency will be to carry 
out the recommendations of the Economic 
Survey Mission for the Middle East, ap- 
pointed by the United Nations. This Survey 
Mission, under the Chairmanship of Gordon 
Clapp, was directed by the United Nations 
to study the economic dislocation created by 
the conflict in Palestine and to recommend 

136 



Harry S. Truman, ig^o 



Jan. 30 [25] 



importance, in the interests of our foreign 
policy, of economic development of under- 
developed areas. In such a case as this, 
where relief for refugees is essential, it is 
advantageous to combine the relief program, 
with the beginnings of longer range eco- 
nomic development. 

Point Four legislation and legislation for 
the United Nations Relief and Works 
Agency for Palestine Refugees are comple- 
mentary. There is no overlapping in the 
request for funds for the two programs. 

The immediate reason for the establish- 
ment by the United Nations of the Economic 
Survey Mission to the Middle East was the 
hope that through an economic approach it 
might be possible to facilitate a peace settle- 
ment between Israel and the neighboring 
Arab states. The problems of Palestine and 
her neighbors are complicated by the con- 
tinuing plight of over three-quarters of a 
million persons who left their homes during 
the conflict in Palestine, and are now refugees 
in the neighboring lands. Homeless and 
without work, these people cannot care for 
themselves. The nations now giving them 
asylum are themselves unable to care for 
them. For some time to come they will re- 
main dependent on others for their support. 

In response to an appeal from the General 
Assembly of the United Nations for relief 
funds, made in December 1948, I recom- 
mended to the Congress that the United 
States should bear up to one-half of the cost 
of a relief program which was estimated to 
cost $32 million for a nine month period. 
The Congress appropriated f 16 million for 
this purpose. Our contribution has been 
more than equalled by the contributions of 
32 other countries. The fund thus raised 
has been stretched to its limits and is now 
exhausted. 

The United Nations Economic Survey 
Mission has recommended a combined relief 



and public works program, and has esti- 
mated the cost of this program at $54,900,000 
for an eighteen month period beginning 
January i, 1950. 

This program is significant in its practical 
approach to our objective of economic de- 
velopment in underdeveloped areas. The 
areas in question have unrealized economic 
potentialities but require technical assistance 
from abroad to assure their development. 
The projects proposed will be complete in 
themselves, representing intensive develop- 
ment in small areas, and have been so se- 
lected that they can be brought to completion 
by the middle of 1951. They will result in 
lasting economic benefits. 

In illustrating what can be done with lim- 
ited resources of soil and water by the appli- 
cation of modern engineering and agricul- 
tural techniques, these projects should point 
the way to further development not only in 
the countries where they are carried out, but 
in neighboring countries as well. The suc- 
cessful completion of this program should go 
far in furthering conditions of political and 
economic stability in the Near East. At the 
same time the proposed program, while cost- 
ing littie more than direct relief, looks to the 
end of the direct relief program of the 
United Nations in the Near East, and to 
ultimate solution of the refugee problem. 

I believe that it is appropriate that the 
United States should continue to bear one- 
half the cost of this program. I, therefore, 
recommend that the Congress authorize and 
appropriate $27,450,000 for an eighteen 
month period. I trust that other nations 
which have contributed to the program in 
the past will be equally generous in the 
future. 

The importance of a substantial United 
States contribution to this program is very 
real. Not only is it consistent with the 
humanitarian spirit of the American people; 



137 



[25] Jan. 30 



Public Papers of the Presidents 



it is also in our national interest to help main- 
tain peaceful and stable conditions in the 
Near East. 

It is with these considerations in mind that 
I recommend to the Congress the early enact- 
ment of legislation to enable the United 
States to take its part in this program of the 
United Nations. 

Sincerely yours, 

Harry S. Truman 

note: This is the text of identical letters addressed 
to the Honorable Alben W. Barkley, President of 
the Senate, and to the Honorable Sam Rayburn, 



Speaker of the House of Representatives. 

On June 5, 1950, the President approved the For- 
eign Economic Assistance Act of 1950 (64 Stat. 
198). Tide III of the act is entided "United Na- 
tions Palestine Refugee Aid Act of 1950." Under 
section 302 the Secretary of State was authorized 
"to make contributions from time to time before 
July I, 1 95 1, to the United Nations for the 'United 
Nations Relief and Works Agency for Palestine 
Refugees in the Near East,* established under the 
resolution of the General Assembly of the United 
Nations of December 8, 1949, in amounts not ex- 
ceeding in the aggregate $27,450,000 for the pur- 
poses set forth in this title.'* For the statement 
by the President upon signing the Foreign Economic 
Assistance Act, see Item 154. 



26 Statement by the President on the Hydrogen Bomb. 
]anuary 31, 1950 



IT IS part of my responsibility as Com- 
mander in Chief of the Armed Forces to see 
to it that our country is able to defend itself 
against any possible aggressor. Accordingly, 
I have directed the Atomic Energy Com- 
mission to continue its work on all forms of 
atomic weapons, including the so-called 
hydrogen or superbomb. Like all other 
work in the field of atomic weapons, it is 



being and will be carried forward on a 
basis consistent with the overall objectives of 
our program for peace and security. 

This we shall continue to do until a satis- 
factory plan for international control of 
atomic energy is achieved. We shall also 
continue to examine all those factors that 
affect our program for peace and this coun- 
try's security. 



27 Telegram to Labor and Management Leaders Proposing a Plan 
for Settling the Coal Industry Dispute. January 31, 1950 



SINCE June of 1949 work has been per- 
formed by the members of the United Mine 
Workers of America, and bituminous coal 
mines have been operated by their owners 
and operators, only intermittently and with- 
out the stabilizing advantages of a labor 
contract. Many months of bargaining by 
the representatives of the parties and the 
efforts of mediation officers of the Govern- 
ment have failed to produce a settlement of 
their dispute. That dispute visits severe 
hardship upon the miners and their families 



and severe economic loss upon those who 
have invested in bituminous coal mines. 
The continuous production of an adequate 
supply of bituminous coal is essential to the 
economic stability, progress and security of 
this Nation. Continuing stoppages, re- 
strictions in production and shortages which 
result from the inability of the parties to 
setde their dispute are of grave concern to 
the people of the Nation. 

The law places the responsibility for 
settling management-labor disputes on the 



138 



Harry S. Truman, ig^o 



Jan. 31 [27] 



parties, not the Federal Government. The 
Government can give them mediation as- 
sistance; but in the final analysis the parties 
themselves must wiixjt their ov^n collective 
bargaining agreement. Voluntary action, 
not compulsion, in these matters is not only 
my personal conviction but the national 
policy. The Government can no longer 
stand by, hovi^ever, and permit the continu- 
ance of conditions w^hich have novi^ come to 
have such a serious effect upon the public 
interest. Accordingly, I am making the 
follovi^ing proposal to the representatives of 
the parties: 

(a) That work be performed and normal 
production maintained for a period of 70 days 
beginning February 6 under the terms and 
conditions last agreed upon by the Union and 
the employers, excepting as such terms and 
conditions may be modified by agreement of 
the parties or by law^. 

(b) That representatives of the parties ap- 
pear before and cooperate v^^ith a Fact-Find- 
ing Board v^hich I shall appoint. This Board 
v^ould consist of three citizens representing 
the public, none of them from Government, 
Industry or Labor. It v^ould be empov^^ered 
to inquire into any and all facts and circum- 
stances relating to the current dispute. The 
Board w^ould be requested to make its report, 
including findings and recommendations, 
w^ithin 60 days after February 6. The rec- 
ommendations w^ould be addressed to the 
parties and to the President, outlining the 
procedures and the grounds for a fair and 
equitable settlement of the current dispute. 
Immediately after the publication of the 
Board's report, representatives of the parties 
MTould be called into conference by the Di- 
rector of the Federal Mediation and Con- 
ciliation Service, who would seek to assist 



them in resolving their dispute in light of 
the recommendations or any modification 
thereof which might be suggested by the 
parties. The parties or either of them would 
be free to accept or reject the recommenda- 
tions of the Board as they see fit. 

In making this proposal, I do not wish to 
interfere with any bargaining conferences 
that may assist in the settlement of this dis- 
pute. I would appreciate your informing 
me by 12 noon, Saturday, February 4, 1950, 
if the normal production of coal will be re- 
sumed on Monday, February 6, 1950, with- 
out reference to this proposal. If produc- 
tion will be so resumed this proposal may be 
disregarded. If you cannot inform me that 
normal production will be resumed on Mon- 
day without reference to this proposal, I 
would then want your reply to this proposal 
by 5 p.m. Saturday, February 4, and I urge 
your acceptance in the National interest. 

Harry S. Truman 

note: This is the text of identical telegrams ad- 
dressed to the following persons: George H. Love, 
operators' spokesman for the National Bituminous 
Wage Conference, and president of the Pittsburgh 
Consolidation Co.; John L. Lewis, president. United 
Mine Workers of America; Harry M. Moses, 
president, H. C. Frick Coal Co.; and Joseph E. 
Moody, president. Southern Coal Producers 
Association. 

On February 6, 1950, the President signed Execu- 
tive Order 10106 "Creating a Board of Inquiry to 
Report on a Labor Dispute Affecting the Bitumi- 
nous Coal Industry of the United States" (3 CFR, 
1 949-1 953 Comp., p. 300). The order was issued 
pursuant to section 206 of the Labor Management 
Relations Act, 1947 (Taft-Hartley Act). 

On the same day the President appointed the 
following persons as members of the Board: W. Wil- 
lard Wirtz, John T. Dunlop, and David L. Cole, 
chairman. The Board's report, entitled "Report to 
the President: The Labor Dispute in the Bituminous 
Coal Industry,*' was submitted to the President on 
February 11, 1950 (Government Printing OflSce: 
I950> 8 pp.). 

See also Items 35, 49, and 50. 



139 



[28] Feb. I Public Papers of the Presidents 

28 Letter to the Speaker on the Panama Canal and the 
Panama Railroad Company. February i, 1950 

[ Released February i, 1950. Dated January 31, 1950 ] 



Dear Mr, Speaker: 

I am transmitting herewith the report and 
recommendations of the Bureau of the 
Budget with respect to the organization and 
operations of the Panama Canal and Panama 
Railroad Company. The report was pre- 
pared pursuant to House Report No. 1304, 
8ist Congress, ist Session. 

The recommendations of the Bureau of 
the Budget have my approval except the 
recommendation with respect to the transfer 
of supervision of the Panama Canal from the 
Secretary of the Army to the Secretary of 
Commerce. I desire to give further study 
to that recommendation, particularly in con- 
nection with plans to carry out the proposals 
of the Commission on Organization of the 
Executive Branch of the Government which 
are now under consideration. 

As preliminary steps to facilitate the rec- 
ommended reorganization of the Panama 
Canal and the Panama Railroad Company I 
have today issued two executive orders. 
The first delegates to the Governor of the 
Panama Canal authority to determine the 
internal organization of the Panama Canal. 
The second order transfers certain business 
operations from the Panama Canal to the 
Panama Railroad Company. These initial 
transfers will simplify and facilitate the early 
transfer to the Company of all business op- 
erations of the Panama Canal. 



While several of the recommendations can 
be implemented by executive order, legisla- 
tion is required to (i) authorize transfer of 
the Panama Canal to the Panama Railroad 
Company; (2) change the name of the 
Panama Railroad Company to Panama 
Canal Company; (3) authorize the Com- 
pany's board of directors to establish toll 
rates, subject to the President's approval; 
(4) permit the Company to retain and utilize 
toll revenues; and (5) authorize appropria- 
tions to the Company to cover losses which 
might result from changes in economic con- 
ditions. I recommend the enactment of 
such legislation. 

It is believed that implementation of the 
Bureau of the Budget's recommendations 
will result in a more logical grouping of func- 
tions, provide a sounder basis for determin- 
ing toll rates and other charges, facilitate 
operations, and, in general, promote the 
more effective administration of the Panama 
Canal enterprise. 

Very sincerely yours, 

Harry S. Truman 

[Honorable Sam Rayburn, Speaker of the House of 
Representatives ] 

note: The President referred to Executive Order 
loioi "Amendment of Executive Order No. 9746 
of July I, 1946, Relating to the Panama Canal" and 
Executive Order 10 102 "Transfer of Certain Busi- 
ness Operations, Facilities and Appurtenances from 
the Panama Canal to the Panama Railroad Com- 
pany" (3 CFR, 1 949-1 953 Comp., p. 296). 



29 The President's News Conference of 
February 2, 1950 



THE PRESIDENT, [i.] Last Week there was 
a misunderstanding about a certain appoint- 
ment. I was talking about one thing and 



the question was about another.^ 
Q. A little louder, please! 
^ See Item 23 [20]. 



140 



Harry S. Truman, ig$o 



Feb. 2 [29] 



THE PRESIDENT. I say last week there was a 
misunderstanding about a man under con- 
sideration for a certain appointment. I 
thought the question was in regard to one 
initial organization and it was in regard to 
another. 

I will clear that up this morning by an- 
nouncing the appointment of Paul L. Styles 
to the National Labor Relations Board, to 
take the place of Mr. Gray. 

That's all the announcements I have to 
make. 

[2.] Q. Mr. President, do you have any 
plans for giving the FEPC bill a boost 
through the House by speaking to the 
Speaker and asking him to recognize Chair- 
man Lesinski ? ^ 

THE PRESIDENT. You should be at the Big 
Four ^ meetings every Monday morning. 
You would hear that we discuss it nearly 
every Monday morning. 

Q. How do you get in to the Big Four? 
[Laughter] 

THE PRESIDENT. You havc to havc a special 
dispensation. 

[3.] Q. Mr. President, yesterday you is- 
sued an Executive order on the dissemina- 
tion of information, and in it, in the last 
paragraph, you include military documents 
and reports which have been marked "Con- 
fidential" and "Restricted" — also "Top 
Secret" and "Secret," etc. That classification 
"Restricted" is one of the most general I 
have ever seen. 

THE PRESIDENT. It is cxactly a copy of the 
order that has been in effect all the time, 
and the only reason that order was issued 
was that it conform with the new Defense 



® Representative John Lesinski of Michigan, Chair- 
man of the House Committee on Education and 
Labor. 

^Alben Barkley, Vice President of the United 
States; Sam Rayburn, Speaker of the House of 
Representatives; Scott W. Lucas, Senate Majority 
Leader; and John W. McCormack, Majority Floor 
Leader in the House of Representatives. 



Act. There isn't any difference with this 
order and the one that has been in ef- 
fect^ 

Q. The point was 

THE PRESIDENT. that the order con- 
form with the new law on the Defense Act. 
Unification — it's an order to conform with 
the Unification Act. That's all there is to it. 
That order has been in effect ever since I 
have been President. 

Q. Is there any way to get a definition of 
"Restricted," so that the Army officers would 
know what it means.? In some places it 
refers to clippings. 

THE PRESIDENT. I Can't auswer the ques- 
tion. You will have to talk to somebody that 
uses "Restricted." I don't use it. [Laugh- 
ter] 

Q. Well, every office boy seems to stamp 
"Restricted" or "Confidential," and I have 
seen many "Confidential" and "Restricted" 
documents which had no reason whatever to 
be 

THE PRESIDENT. You ucver saw one come 
out with my signature on it. [Laughter] 
You talk to them, now. That's their busi- 
ness not mine. Those "Restricted" docu- 
ments are mostly military. 

[4.] Q. Mr. President, has Governor 
Forrest Smith ^ been in to see you in the last 
few days, or do you expect to see him soon? 

THE PRESIDENT. Ycs, I cxpect to see him 
about the i6th of February. 

[5-] Q- Well, Mr. President, returning 
to this Executive order a moment, would you 
interpret it for us? 

THE PRESIDENT. No, I wou't try to inter- 
pret it for you — and that's final, and I don't 



* Executive Order 10104 "Defining Certain Vital 
MiHtary and Naval Installations and Equipment as 
Requiring Protection Against the General Dissemi- 
nation of Information Relative Thereto" (3 CFR, 
1949-1953 Comp., p. 298). The order superseded 
Executive Order 8381 of March 22, 1940 (3 CFR, 
Cum. Supp., p. 634). 

^ Of Missouri. 



141 



[29] Feb. 2 



Public Papers of the Presidents 



intend to comment on it further. That order 
speaks for itself. You can put your own in- 
terpretation on it. 

Q. Mr. President, I have seen a picture 
of the North Pole taken from an airplane 
marked "Restricted." [Laughter] 

Q. What? 

Q. The North Pole— North Pole. 

THE PRESIDENT. A picture of the North 
Pole marked "Restricted." I can't comment 
on that, though. Take it up with the Attor- 
ney General or the military which is respon- 
sible. 

Q. There is pretty much confusion about 
what we can write and what we can't. 

THE PRESIDENT. I am sorry about that. 
Since I have been President 

[6.] Q. Mr. President, do you have any 
comment on the refloating of the battleship 
Missouri? 

THE PRESIDENT. No COmmCUt.^ 

[7.] Q. Mr. President, do you have any 
comment on the present crisis relating to the 
surplus of potatoes? 

THE PRESIDENT. I think the lady from 
Maine ought to know more about potatoes 
than anybody in the United States. She 
ought to understand that this farm act which 
was amended last year puts us in the position 
to place those potatoes in the condition in 
which they are. And that whole thing is a 
sectional thing, and for the benefit of the 
potato growers of Maine as well as the other 
potato growers in the United States; but that 
is how it came about. I suggest you talk to 
Senator Brewster about it. 

Q. Half the surplus, I understand, is 
scattered all over the country. 

THE PRESIDENT. Ycs, and the other half is 
in Maine — 25 million bushels are in Maine. 

®On January 17 the U.S.S. Missouri, the only 
active battleship in the United States fleet, ran 
aground in the Chesapeake Bay near Thimble Shoal 
Light. The mishap occurred at the start of a routine 
training cruise to Guantanamo, Cuba. The ship 
was refloated on February i. 



Q. That's right. 

[8.] Q. Mr. President, would the Chief 
of Naval Operations have the authority to 
decide whether the Missouri should be re- 
placed by an airplane carrier, or would that 
be entirely up to you.? 

THE PRESIDENT. That is a matter that prob- 
ably would be discussed with me before it 
was done. The Secretary of the Navy has 
the right to make that order, if he so chooses. 

[9.] Q. Mr. President, did you talk to 
Mr. Maury Maverick^ about any matters 
down in Texas.? 

THE PRESIDENT. No, I dou't think we did. 
I discussed a lot of things historically with 
Maury Maverick. He brought me in three 
very interesting books. One about White 
House furniture. One on army regulations 
of 1835 — which is most interesting — ^I am 
going to send that to West Point for their 
Library. 

And I forget what the other one is — Oh, 
I know — it is a book by a gentleman named 
Major General Truman. [Laughter] He 
made the first Truman report to the United 
States President of 1869. -^^^ ^^ ^^^ °^ ^^ 
reconstruction of the South. And while I 
was in the Senate, when I got out my first 
report as chairman of that Committee, Mr. 
Halsey who was then the Secretary of the 
Senate, hunted up this old Truman report. 
It is most interesting. 

Q. Mr. President, was that top secret then.? 

THE PRESIDENT. Not that I kuOW of. 

[10.] Q. Mr. President, will the batde- 
ship Missouri be taken out of service.? 

THE PRESIDENT. I can't auswer the question. 

[11.] Q. Mr. President, Senator Vanden- 
berg yesterday said that he wished that you 
would follow up your directive on the super- 
bomb with a formal notification to the 
United Nations, first, that you have ordered 
work to proceed on it; second, that the 



^Former Representative Maury Maverick of San 
Antonio, Tex. 



142 



Harry S. Truman, ig^o 



Feb. 



[29] 



United States stands ready to suspend the 
project at the moment Soviet Russia permits 
adequate international control. 

THE PRESIDENT. I have no comment on 
Senator Vandenberg's statement, but for 
your information we have urged constandy 
that international control be accepted by all 
the nations of the world. Hardly a week 
goes by that that matter is not brought up, 
at my suggestion, in the United Nations, 

[12.] Q. Mr. President, in your first an- 
swer on FEPC do you mean that you have 
asked the Speaker to recognize 

THE PRESIDENT. Why Certainly I have. I 
talk to him about it every Monday morning. 

Q. You have asked him to recognize 
Lesinski? 

THE PRESIDENT. No, I didu t ask him to 
recognize anybody, I asked him to consider 
the passage of FEPC in both Houses. I 
didn't ask him to recognize anybody. That's 
the business of the Speaker. He has been 
in charge of that, and nobody can tell him 
whom to recognize, 

[13.] Q. Mr. President, I have a pro 
forma thing, if nothing else. Do you think 
notification to the United Nations of the new 
superbomb project is necessary or advisable? 

THE PRESIDENT. I dou't think it's necessary 
or advisable. 

Q. Mr. President, do you plan to do any- 
thing to use the new superbomb as a basis 
to make any new move for international 
control? 

THE PRESIDENT. I covcrcd that in the state- 
ment that was made the other day, which 
covers it completely.^ 

[14.] Q. Mr. President, do you have any 
comment on Russia's demand that Hirohito 
be tried? 

THE PRESIDENT. I was informed just now 
by the Secretary of State that a 20-page state- 
ment, in Russian, was delivered to the Secre- 

® Item 26. 



tary of State. The Secretary of State can't 
read Russian, so until it is translated, we can 
make no comment on it.® 

[15.] Q. Mr. President, yesterday Gov- 
ernor Duff of Pennsylvania and five other 
Governors urged that the Republican Party 
should be an organization that is broad and 
not exclusive, a party of service and not of 
privilege, a party that is hard-hitting and not 
timid, a party that is progressive and not 
backsliding, a party that is constructive and 
not petty. 

THE PRESIDENT. I would suggcst that the 
Governor of Pennsylvania join the Demo- 
cratic Party. That's [Laughter] 

Q. Could we have the text of that ques- 
tion? 

THE PRESIDENT, He wanted the text of 
your question. 

THE PRESIDENT. Jack wiU give it to you. 

Mr. Romagna [reading]: "That the Re- 
publican Party should be an organization 
that is broad and not exclusive 

Q. Mr. President, maybe I'd better read 
it from this: "That the Republican Party 
should be an organization that is broad and 
not exclusive, a party of service and not of 
privilege, a party that is hard-hitting and 
not timid, a party that is progressive and 
not backsliding, a party that is constructive 
and not petty." 

THE PRESIDENT. And I iuvited the Gover- 
nor to join the Democratic Party. We al- 
ready have that sort of party. [Laughter] 

Q. Mr. President, do you think the Gov- 
ernor 

Q. Mr. President, can we 

THE PRESIDENT. Wait a miuutc — I prom- 
ised to answer him — I promised to answer 
his question. 

®For the text of a State Department release of 
February 3 questioning the motives of the Soviet 
Union on their request that the Emperor of Japan 
be tried, see the Department of State Bulletin (vol. 
22, p. 244). 



143 



[29] Feb. 2 



Public Papers of the Presidents 



Q. Do you think the Governor has done a 
good job describing the Democratic Party? 

THE PRESIDENT. The Democratic Party is 
the sort of party he describes. 

Now what was that question back there? 

Q. Can we put quotes around your reply 
to that question? 

THE PRESIDENT. I havc no objcction to that. 

[16,] Q. Mr. President, some days ago 
Mr. Stowe was quoted as saying that he had 
intervened in behalf of the Lustron Corpora- 
tion with RFC, on the ground that the na- 
tional defense angle should be considered.^® 
Would you comment on that, sir? 

THE PRESIDENT. I have uo commcut. 

[17.] Q. Mr. President, have you chosen 
a successor to David E. Lilienthal yet? 

THE PRESIDENT. No, I have not. I will 
announce it to you just as soon as I am ready 
to appoint the man. 

[18.] Q. Mr. President, do you like the 
new proposed amendment to revise the elec- 
toral system? ^^ 



*" The Reconstruction Finance Corporation had 
ordered the Lustron Corporation, a manufacturer 
of prefabricated housing, to submit a plan for 
putting its financial affairs in order. The New York 
Times reported that on January 5 the Lustron Cor- 
poration filed a reorganization plan with the RFC 
seeking to head off Federal foreclosure action on 
$22 million worth of overdue loans. 

" On January 5, 1949, Senator Henry Cabot Lodge, 
Jr., of Massachusetts, and 11 other Senators intro- 
duced S.J. Res. 2, proposing an amendment to the 
Constitution changing the method of electing the 
President and Vice President. Under the proposed 
amendment all presidential candidates would share 
the electoral votes of each State in proportion to 
the number of popular votes that they had received. 
The candidate receiving the most electoral votes, 
providing that he had obtained more than 40 per- 
cent of the total, would be elected. If none of the 
candidates received 40 percent of the electoral votes, 
the House and Senate jointly would elect a President 
and a Vice President from among the two top can- 
didates for each office. 

S. J. Res. 2 was passed by the Senate on February 
I, 1950. On July 17, 1950, the House voted 134- 
210 against bringing the bill to the floor, and the 
proposed amendment expired with the 8ist Congress. 



THE PRESIDENT. Well, I Ordinarily don't 
comment on any legislation that is pending, 
but you know a constitutional amendment is 
not a matter that the President passes on, it 
is passed by two-thirds vote of both Houses. 
And then it is sent to be ratified by three- 
fourths of the States. 

I think that this resolution that was passed 
by the Senate yesterday is a forward step. 
I was very much interested in it. I have 
read all the records and all the hearings on 
it; and I made some suggestions myself on 
the thing, most of which were adopted. 
And I believe it would be a step in the right 
direction if the States choose to ratify the 
constitutional amendment. It takes 36 
States to ratify an amendment. 

But I would advise you to read the hear- 
ings on that, they are most interesting. You 
will find more about elections and presiden- 
tial history that you never heard of before, if 
you haven't read it. 

[19.] Q. Mr. President, in the proposi- 
tion to the coal operators and John L. 
Lewis,^^ you ask for a return to normal pro- 
duction. Would you care to say whether 
that requires a 5-day week, or less.? 

THE PREsmENT. I askcd for normal pro- 
duction under the reinstatement of contract. 
The contract itself sets that out. 

Q. Mr. President, that means 

THE PRESIDENT. You wiU have to translate 
that yourselves. In some places they can't 
work a full week on account of the local 
situation. Now that applies all over the 
United States. Generally, I would say that 
it means a 5-day week. 

Q. Are you ready to invoke the Taft- 
Hardey Act, if they don't? 

THE PRESIDENT. Whenever there is an 
emergency, I will invoke the Taft-Hardey 
Act, as I told you before. 

Q. Senator Byrd intimated that you had 

^ See Item 27. 



144 



Harry S. Truman, igp 



Feb. 2 [30] 



an agreement with the labor movement not 
to invoke it? 

THE PRESIDENT. Hc may knov7 something 
that I don't. I have no such agreement. 

[20.] Q. Mr. President, I am not trying 
to heckle you on this 

THE PRESIDENT. That's all right. Try 
your best; you can't heckle me. Go ahead. 
[Laughter] 

Q. Well, in any case, sir, we are forced to 
rely on gossip and so-called White House 
circles, and things like that, to determine 
what caused you to reach your decision to 
produce the superbomb? 

THE PRESIDENT. The Statement that I re- 
leased covers the ground so far as I expect 
to go with it. 

Q. Do you — you wouldn't care, sir, to 
elaborate — I mean 

THE PRESIDENT. No. No, I have no fur- 
ther statement to make except the one that 
was released. 

Q. Mr. President, Senator McMahon has 
indicated that he is about to make a speech 
asking for a nationwide public discussion of 
the issues raised by the superbomb. To do 
that, facts about it are necessary. Can wc 
look forward to having some disclosures fur- 
ther than that 

THE PRESIDENT. No, you canuot look for- 
ward to anything except what was stated. 

[21.] Q. Mr. President, do you plan to 
send up your message on the New England 
public power program pretty soon? 

THE PRESIDENT. I don't know whether I 



can get it ready in a short time, but we are 
working on it.^^ 

[22.] Q. Mr. President, have you asked 
Mr. Webster to head up the Research and 
Development Board? 

THE PRESIDENT. He is Under consideration. 

[^3-] Q- Mr. President, have you re- 
cently given Governor Gruening of Alaska 
assurances of stepping up the defenses for 
the Territory? 

THE PRESIDENT. I discusscd the matter 
with Governor Gruening and with the Secre- 
tary of Defense, and of course that situation 
will be covered in the general defense pro- 
gram of the country. 

[24.] Q. Mr. President, do you think 
the new electoral law will help you get re- 
elected in 1952? [Laughter] 

THE PRESIDENT. For your information, 
that resolution is passed by a two-thirds vote 
by both Houses. It will not be law in 1952, 
you can be sure of that. [Laughter] 

[25.] Q. Mr. President, do you plan any 
action on oil imports? 

THE PRESIDENT. Thc matter is under con- 
sideration by the State Department now. 
I think Dean Achcson answered that yester- 
day in his press conference.^* 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You are entirely welcome. 

note: President Truman's two hundred and fifteenth 
news conference was held in his office at the White 
House at 10:30 a.m. on Thursday, February 2, 1950. 

"Item 33. 

"For the statement of Secretary of State Dean 
Acheson at his press conference on February i, see 
the Department of State Bulletin (vol. 22, p. 292). 



30 Statement by the President on the Crusade Against 
Heart Disease. February 2, 1950 



THE Surgeon General of the United States 
Public Health Service has called heart dis- 
eases, which annually kill more than 625,000 
men, women, and children, our most chal- 



lenging public health problem. They are 
the Nation's leading cause of death. Meas- 
ures to cope with this threat are of immedi- 
ate concern to every one of us. 



145 



[30] Feb. 2 



Public Papers of the Presidents 



Such measures are already making them- 
selves felt. Extensive efforts are being made 
to control heart diseases. Nationwide pro- 
grams, both governmental and voluntary, 
aimed at the reduction of death and dis- 
ability due to cardiovascular disease, are 
functioning on a wide scale. 

Many of our finest scientific minds, our 
most highly skilled physicians, our civic- 
minded business and professional leaders, 
are enlisted in this great crusade. But they 
cannot be expected to do the whole job by 



themselves. Victory in the fight they are 
waging for all the people can be achieved 
only with the cooperation of the general 
public. 

I, therefore, urge every citizen to learn the 
facts about heart diseases and the steps that 
are being taken to combat them. I urge 
every citizen, for his own sake and that of 
the Nation as a whole, to give wholehearted 
support to physicians and scientists engaged 
in an unceasing battle against heart diseases. 



31 Remarks to a Group of Baptist Missionaries. 
February 3, 1950 



AS I told you, the only way we will ever 
arrive at peace in the world is to setde it on 
a moral Christian basis. And that is what 
I have been working on for 5 years or more. 
We sometimes think we are approaching a 
solution, and then sometimes we are not so 
sure. I think every one of you can make 
a very decided contribution. 

I wish I had the time to talk with each 
one of you and find out what conditions 
actually are, as you see them on the ground, 
in these foreign countries. But of course 
you know that I do not have the time to do 
that, much to my regret. 

But you ought to always bear in mind that 
this country of ours has no aggressive am- 



bitions of any sort. Our interest is the peace 
and welfare of the people in the countries 
with which we are associated, and no desire 
on our part to take them over, either govern- 
mentally, financially, physically, or otherwise. 

I know that you can make a tremendous 
contribution to the cause of peace by making 
that perfecdy plain to the people with whom 
you associate. 

Thank you very much. 

note: The President spoke at 3:30 p.m. in his office 
at the White House. The group was composed of 
24 missionaries who had been serving in China, 
Argentina, Nigeria, Burma, Japan, the Belgian 
Congo, Hungary, and the United States. They were 
headed by the Rev. Dr. Edward H. Pruden, pastor 
of the First Baptist Church in Washington, the 
church attended by President Truman. 



32 Statement by the President on Appointing Additional 
Members of the Committee on ReUgion and Welfare 
in the Armed Forces. February 8, 1950 



I AM appointing two additional members of 
the President's Committee on Religion and 
Welfare in the Armed Forces. They are 
Mrs. George Hamlin Shaw and Mr. Francis 
Keppel. 



Since this Committee was established in 
October 1948, the scope of its work has grad- 
ually increased, although its overall respon- 
sibility has remained the same. That re- 
sponsibility is to further the policy of the 



146 



Harry S. Truman, ig^o 



Feb. 9 [33] 



Government as stated in the Executive order 
establishing the Committee: "to encourage 
and promote the spiritual, moral, and recrea- 
tional w^elfare and character guidance of per- 
sons in the Armed Forces and thereby to 
enhance the military preparedness and se- 
curity of the Nation," With the deactiva- 
tion of USO in the past month, and the con- 
tinued unsetded state of w^orld affairs, the 
increasing importance of this Committee's 
vi^ork is apparent to every thinking citizen. 

Within the overall responsibility of the 
Committee there are three major areas of 
interest that encompass a broad range of 
specific policies and programs: (i) organized 
community activities on behalf of service 
men and women; (2) civilian attitudes to- 
ward the needs of service men and women; 
and (3) policies and programs of the De- 
partment of Defense affecting their religious 
and moral welfare. 

The Committee's first annual report, 
which it recendy submitted to me, shows 
that it already has accomplished much in 
appraising and helping to develop activities 
and policies within these three areas. 

A program has been developed for orga- 
nized services that will welcome each serv- 
ice man and woman into community life as 
a member of that community. Recommen- 
dations to the Secretary of Defense on the 
serious shortage of housing facilities for mar- 



ried military personnel were approved and 
are now being put into effect. The Com- 
mittee's report on "Information and Educa- 
tion in the Armed Forces" firmly establishes 
the policy to provide our military personnel 
with the information and education they de- 
sire and need for maximum military eiBEec- 
tiveness. 

As the Committee finishes each of its 
various studies, it has a continuing respon- 
sibility to maintain an active interest in each 
subject and to return to it should the situa- 
tion require. Therefore, the scope of its 
work is constantly increasing and it is nec- 
essary that it have the additional assistance 
available from the two additional members 
I have appointed, and the continuing co- 
operation of all our citizens. 

note: The President's Committee on Religion and 
Welfare in the Armed Forces was established by 
Executive Order 100 13 of October 27, 1948 (3 CFR, 
1943-1948 Comp., p. 835). At that time the fol- 
lowing members were appointed: Frank L. Weil, 
chairman, Basil O'Connor, Rev. Edmund A. Walsh, 
Dr. Daniel A. Poling, Truman Gibson, Mrs. Ferdi- 
nand Powell, Sr., Dorothy Enderis, Dr. Lindsley F. 
Kimball, and Mark A. McCloskey. 

The Committee's first report, entitled "Commu- 
nity Responsibility to Our Peacetime Servicemen 
and Women," was submitted to the President on 
March 24, 1949 (Government Printing Office, 1949, 
29 pp.)' Later the Committee submitted the report 
"Information and Education in the Armed Forces; 
a Report to the President" (Government Printing 
Office, 1949, 59 pp.). 

See also Item 95. 



33 Letter to the Vice President Urging a Study of the Land and 
Water Resources of the New England States and 
New York. February 9, 1950 



Dear Mr, Vice President: 

I am informed that the Senate will shortly 
consider H.R. 5472, the rivers and harbors 
and flood control authorization bill. In addi- 
tion to authorizing projects for construction, 
this bill will also authorize a number of 



investigations and studies to be made, look- 
ing to future projects for the development 
and conservation of our land and water re- 
sources. Such investigations and studies 
should be carefully planned, so that all rele- 
vant facts will be considered, and the result- 



147 



[33] Feb. 9 



Public Papers of the Presidents 



ing information and recommendations will 
be of lasting value for future action, both 
governmental and private. 

I am writing this letter to recommend that 
the Senate adopt an amendment to H.R. 
5472 which I understand is to be offered by 
a group of Senators from the New England 
States and New York, providing for a broad- 
scale study of how the land and water re- 
sources of those States may be best conserved 
and developed for the best interests of their 
people and the whole Nation. 

We are often inclined to think that, be- 
cause those States were originally settled 
two hundred years and more ago, and be- 
cause they led the Nation for many years in 
industrial and commercial development, they 
do not need the benefit of modern methods 
of resource development and conservation. 
Such a conception is very far from the truth. 
New York and the New England States have 
real and serious problems of soil and forest 
conservation and management, and of con- 
trolling and using water to prevent floods, 
to provide domestic and industrial water 
supplies, and to furnish low-cost hydroelec- 
tric power. These problems must be over- 
come if these States are to participate fully 
in the economic growth of our country. 

We have gradually come to understand 
that, if best results are to be achieved, these 
problems should be considered together, and 
met by comprehensive planning and action 
which recognizes the close inter-relationship 
of land and water and their manifold uses. 
In many areas of our country coordinated 
plans have been worked out for multiple- 
purpose, integrated development of natural 
resources. However, these seven States have 
not, so far, had the benefit of such compre- 
hensive study and planning. 

Some notable individual projects have 
been planned, such as the St. Lawrence sea- 
way and power project. These projects 
should, of course, proceed without further 



delay. No additional study is needed before 
they are constructed. They are obviously 
necessary parts of any broad-scale program. 
But a wider scope, a broader vision, is needed 
if the full possibilities inherent in the re- 
sources of these States are to be realized. 

In the field of hydroelectric power, for 
example, it is not enough to consider each 
project by itself. There are many undevel- 
oped power sites in the New England States, 
including the Passamaquoddy project, which 
have been estimated to offer in the aggregate 
as much as 3 million kilowatts of additional 
capacity. The redevelopment of the power 
capacity of Niagara Falls, concerning which 
negotiations with Canada are in progress, 
can provide more than i million kilowatts of 
additional capacity. From Niagara on the 
west, through the St. Lawrence project, 
which will provide just under i million kilo- 
watts, and on into the New England States, 
there is a whole range of projects which 
should be considered in relation to each 
other. These projects could all be inter- 
connected by transmission lines. Some of 
them offer a steady, continuous power sup- 
ply; others could provide the intermittent 
supply needed to meet peak loads. Much of 
this power could be produced at as low cost 
as any in the Nation. 

These potentialities need to be thoroughly 
studied, since they offer real possibilities for 
increasing the present power capacity of New 
York and the New England States by as 
much as 50 per cent. 

Development of this great supply of hydro- 
electric power, representing three or four 
times as much electricity as we will obtain 
from the St. Lawrence project alone, would 
clearly stimulate the broad economic devel- 
opment — industrial, commercial, agricul- 
tural — of those portions of the region which 
have for many years been lagging in all- 
around economic progress. 

This power supply would also be a power- 



148 



Harry S. Truman, ig^o 



Feb. 9 [34] 



f ul force toward lower electric rates in New 
York and New England. This region now 
includes some of the highest electric rate 
areas in the country. Residential rates in 
the New York City and Boston metropolitan 
areas in recent years have been the highest 
of all cities over 50,000 population in the 
country — about one-third higher than the 
national average. Six of these seven States 
are among the ten States in the Union hav- 
ing the highest power rates for residential 
consumers. The homes, farms, and indus- 
tries in these States should be enabled to 
share in the general downward trend of 
rates and upward trend of use, which have 
added so much to the prosperity of other 
regions. 

These power possibilities are only one 
example of the questions of land and water 
use in the New England States and New 
York which should be thoroughly studied. 
Some of the worst cases of water pollution 
in the country are found on the rivers in 
these States. A great deal should be done 
to rebuild depleted soils, restore forests, and 
increase recreational opportunities. These 
and other resource questions should be 
studied together, and guidelines laid down 
which will be useful to Federal, State, and 
local governments and private groups in pro- 
viding for the provident husbandry of the 
precious natural resources of these States. 

I believe that a sound method for accom- 
plishing this is provided by the proposed 



amendment to H.R. 5472. The amendment 
would establish a study commission of seven 
members, including citizens from the region 
and representatives of the principal Federal 
agencies concerned. The Commission 
would utilize all the studies which have been 
made already, and would arrange for such 
further investigations as may be desirable. 
An advisory committee appointed by the 
Governors of the seven States would partici- 
pate in the work of the Commission, and 
the Commission's recommendations would 
be submitted to the Governors for their com- 
ments before submission to the President and 
to the Congress. The Commission's final 
report would be submitted in two years, after 
which time it would be dissolved. 

These provisions, which are similar to 
those already adopted by the Senate to estab- 
lish a study commission for the Arkansas, 
Red and White River basins, should result 
in a great combined program for wise, per- 
manent and economically sound develop- 
ment of the natural resources of these States. 
Such a program will be a stimulus to eco- 
nomic growth and prosperity not only for 
those States, but for the whole Nation. 
Sincerely yours, 

Harry S. Truman 

note: As enacted, H.R. 5472 does not contain the 
provisions requested by the President (64 Stat. 163). 
See also his message to the Congress upon signing 
the bill (Item 140, below). 



34 The President's News Conference of 
February g, 1950 



THE PRESIDENT. I have no special announce- 
ments to make today. I will try my best to 
answer questions, if they are not too com- 
plicated. 

[i.] Q. Mr. President, this matter is on 
a State level. Five members of Virginia's 



House of Delegates are pushing a bill to 
abolish segregation within the State. Any 
comment on that, sir.f* 

THE PRESIDENT. No. That is Virginia's 
business. I am glad to hear it, however. 

Q. Mr. President, are you in agreement 



149 



[34] Feb. 9 



Public Papers of the Presidents 



with the brief filed by your Solicitor General 
today in the Supreme Court which opposes 
separate but equal facilities in the segregated 
schools in Virginia? 

THE PRESIDENT. I kuow nothing about such 
a brief. I haven't seen it and I can't com- 
ment on it. 

[2.] Q. Mr. President, several UMW 
locals in Illinois have urged you to seize the 
mines and put the profits in the Treasury. 
Have you any comment? 

THE PRESIDENT. I have uo such power as 
that. 

Q. What was the answer? 

THE PRESIDENT. Thosc are war powers. 

Q. What was the answer, please? 

THE PRESIDENT. I Said I have no such 
powers. Those were war powers. 

Q. You have no powers for seizure, Mr. 
President? 

THE PRESIDENT. I dou't think so. I hope 
not. 

Q. Mr. President, there is no power to put 
the money in the Treasury, however, is there? 

THE PRESIDENT. No. Never. 

Q. Mr. President, do you know if anyone 
in Government is preparing a bill to take 
care of that power? 

THE PRESIDENT. No, I kuow of nothing of 
the kind. I am not asking for any such 
power. 

[3.] Q. Mr. President, do you favor a 
close balance between oil imports and 
exports ? 

THE PRESIDENT. I cau't commeut on that 
at the present time because I haven't all the 
information on the subject. 

[4.] Q. Mr. President, are you expecting 
to hear from your factfinding board on coal 
today? 

THE PRESIDENT. I am expectiug to hear as 
soon as they are ready to report. 

Q. You don't know whether it will be 
today? 

THE PRESIDENT. I Can't tell wheu it will be. 



except they will report as soon as they are 
ready.^ 

[5.] Q. Mr. President, have you received 
any recommendation from the Trade Agree- 
ments Committee regarding negotiations 
between the United States and Germany on 
textile tariffs ? 

THE PRESIDENT. No, I haveu't. 

[6.] Q. Mr. President, the Republicans 
say that the current issue is socialism versus 
liberty. Which one are you for, sir? 

THE PRESIDENT. I dou't Understand that 
very well. I read with a lot of interest that 
Republican platform, but I think the Repub- 
licans' record speaks better for itself than 
any platform they can write. 

[7.] Q. Mr. President, can anything be 
done to keep the Waltham Watch Company 
in business? 

THE PRESIDENT. We have done everything 
we possibly could. Apparently they aren't 
going to stay in business. 

[8.] Q. Mr. President, do you plan to 
appoint a committee to study radio and tele- 
vision allocations? 

THE PRESIDENT. I hadn't thought about it. 

Q. What was that question, sir? 

THE PRESIDENT. He Wanted to know if I 
planned to appoint a committee to study 
radio and television allocations. We have 
got a board for that purpose. I do not sec 
any use for me to. 

[9.] Q. Mr. President, is Secretary Gray 
coming in to resign? 

THE PRESIDENT. I don't kuow. He is going 
to see me after you fellows get through. He 
has been trying to resign for quite a while, 
and I have been able to persuade him to stay, 
up to date. 

Q. No decision on whether he is going to 
leave? 

THE PRESIDENT. No. That is what he is 
coming to tell me this afternoon.^ 

^ See Item 35. 
^ See Item 81. 



150 



Harry S. Truman, ig^o 



Feb. 9 [34] 



[10.] Q. Mr. President, this New Eng- 
land power letter asks that Passamaquoddy 
be considered by the proposed new New 
England-New York Commission. What 
will be the relationship of that commission 
to the International Joint Commission which 
is now studying Quoddy? 

THE PRESIDENT. The relationship would be 
simply a coordination of the whole New 
England power program, that's all. It 
would not interfere with the International 
Commission at all. In fact, I think it would 
be an asset to the International Commission. 

[11.] Q. Mr. President, concerning oil 
imports — the question that was asked a 
moment ago — Mr. Patman asked you to 
invoke the power under the National Trade 
Agreements. Do you intend to submit that 
question to the Tariff Commission for its 
recommendation ? 

THE PRESIDENT. I cau give you the answer 
to that question better when I have all the 
information in my hands, which I haven't, 
as yet. 

[12.] Q. Mr. President, a group of scien- 
tists in New York recently spoke of forming 
some sort of citizens commission, created by 
your office, to make a complete reevaluation 
of our atomic policies? 

THE PRESIDENT. Did you read Mr. 
Acheson's statement lately? ^ I will advise 
you to read it. That will answer your 
question. 

[13.] Q. Mr. President, is Charles E. 
Luckman being considered for Chairman of 
the Atomic Energy Commission? 

THE PRESIDENT. I am uot Considering any- 
body in particular, right at the present time. 
When I find the right man, I will let you 
know about it right away. 

Q. What about Luckman in the National 
Security Resources Board? 



THE PRESIDENT. I am not considering Mr. 
Luckman for any j ob whatever. He is doing 
the job that he is doing right now: selling 
tickets to the Democratic dinner.^ [Laugh- 
ter] 

Q. Well, if he does good, might he be 
considered? 

THE PRESIDENT. He has douc excellent. 
He has done an excellent job of it. 

Q. Didn't hear your reply, Mr. President. 

THE PRESIDENT. I Said he has done an ex- 
cellent job in the job he is in. Every time 
I have asked him to do anything for me, he 
has done an excellent job. 

[14.] Q. Mr. President, do you agree 
with Senator McMahon that this is a time 
for soul-searching, nationwide debate on the 
question posed by the hydrogen bomb? 

THE PRESIDENT. Did you read Secretary 
Acheson's statement yesterday? ^ 

Q. Yes, sir. 

THE PRESIDENT. I would advisc you to read 
it 

Q. He seems not to think so. 

THE PRESIDENT. because that covers 

the ground. The Secretary and I are in 
complete agreement. 

Q. He spoke for you? 

THE PRESIDENT. He discussed the matter 
with me. He spoke for the State Depart- 
ment, which is supposed to represent my 
policy on foreign policy. 

[15.] Q. Mr. President, the President of 
the Philippines ^ indicated that — after seeing 
you this week — that he would welcome a 
mission to go out there to study economic 
conditions for recovery and rehabilitation? 

THE PRESIDENT. Wc discussed that. 



®Mr. Acheson's statement on the Soviet nuclear 
explosion and U.S. atomic policy is printed in the 
Department of State Bulletin (vol. 21, p. 487). 



* Charles E. Luckman was chairman of the 1950 
National Jefferson-Jackson Day Committee, 

''For Secretary Acheson's statement at his press 
conference on February 8, see the Department of 
State Bulletin (vol. 22, p. 272). 

*Elpidio Quirino of the Republic of the Philip- 
pines. President Quirino had been in the United 
States for medical treatment. 



151 



[34] Feb. 9 



Public Papers of the Presidents 



Q. Would you favor sending such a com- 
mission? 

THE PRESIDENT. I havc it undcf considera- 
tion. 

[i6.] Q. Mr. President, getting back to 
Dean Acheson, in other words, you are in 
hearty approval of the Secretary's statement 
yesterday? 

THE PRESIDENT. Yes, I am very much in 
approval of what he had to say. We dis- 
cussed it for quite a while before he made 
the statement. And if you will go back and 
read a litde history, you will find that that 
program has been a continuing one ever 
since we first made the request through the 
United Nations to control atomic energy and 
armaments of all kinds. 

Our position hasn't changed a bit. It has 
been just exactly that all along. We have 
been reiterating it. I have said it over and 
over and over, I think a hundred times, right 
here in this conference, and there isn't any 
use getting all steamed up on the subject, 
because we are continuing all the time every 
effort we possibly can to create a peaceful 
situation in the world. And if we could get 
just one litde bit of cooperation from the 
Soviet Government, we could get the job 
done. 

[17.] Q. Mr. President, getting back to 
a local war, did you know that California 
and Arizona are at daggers point over the 
Colorado River water? 

THE PRESIDENT. Well 

Q. The California delegates tell me you 
recommended to the Chief of Engineers that 
a survey be made to find an extra million 
feet of water which both States could share. 
Do you have any idea where it will come 
from? 

THE PRESIDENT. No. I am having the 
water commission ^ make a complete survey 
of the water situation in the United States. 
You know. New York is just as much inter- 

^ See Item i. 



ested in the subject as California is, and so 
is Baltimore, and so is Houston, Tex., and 
a half dozen other cities that I could name 
to you. That is the reason I appointed this 
water commission. 

The water situation in the Southwest is in 
a terrible situation. Arizona and California 
are both drying up. We have got to find 
some sort of a manner in which to meet that 
situation. And that is the reason I have 
appointed that water commission to make 
a survey. I hope we can solve it, but it is a 
very delicate and a very important problem. 
I hope we will get it solved so that it will be 
all right for those States and places that I 
have named. 

[18.] Q. Mr. President, I would like to 
get cleared up on this Acheson thing. Are 
we standing on the Baruch position or is 
that 

THE PRESIDENT. Our positiou has never 
changed. The Baruch position is just the 
same now as it was the day it was made.® 

Q. That is not being reconsidered? 



® Bernard M. Baruch, the United States Repre- 
sentative to the United Nations Atomic Energy 
Commission, set forth the position of the United 
States in his address deUvered at the opening session 
of the Commission in New York City on June 14, 
1946. 

In his address Mr. Baruch stated that "The United 
States proposes the creation of an International 
Atomic Development Authority, to v^^hich should be 
entrusted all phases of the development and use of 
atomic energy, starting -with the raw materials and 
including: (i) managerial control or ownership of 
all atomic-energy activities potentially dangerous to 
world security, (2) power to control, inspect, and 
license all other atomic activities, (3) the duty of 
fostering the beneficial uses of atomic energy, (4) 
research and development responsibilities of an 
affirmative character intended to put the Authority 
in the forefront of atomic knowledge and thus to 
enable it to comprehend, and therefore to detect, 
misuse of atomic energy. To be effective, the Au- 
thority must itself be the world's leader in the field 
of atomic knowledge and development and thus 
supplement its legal authority with the great power 
inherent in possession of leadership in knowledge." 

For the full text of Mr. Baruch's address see the 
Department of State Bulletin (vol. 14, p. 1057). 



152 



Harry S. Truman, 19^0 



Feb. 9 [34] 



THE PRESIDENT. No rcasoii to rcconsidcr it. 
It is just as good today as it ever was. 

Q. Not altered by anything now? 

THE PRESIDENT. Not thc slightcst. Not the 
slightest. In fact, it ought to be more useful 
now than it was then. 

We thought we were giving away, then, 
something good. We were on an even keel 
then, apparendy. 

Q. Is it your idea, sir, that that ought to 
make Russia more receptive? 

THE PRESIDENT. I Can't answer what Russia 
feels. I know how they have acted. I can 
only go on their actions. I can't tell you how 
Russia feels. Nobody knows. Except by 
their acts in the United Nations — and they 
have voted "no" every time. I don't think 
we have ever exercised the veto power. 

Q. Mr. President, does the Secretary's 
statement, then, foreclose any changes in the 
future on our atomic policy? 

THE PRESIDENT. ThcTC is no rcason for any 
change. We are attempting to get inter- 
national control of atomic energy and trying 
our best to get a peace in the world that will 
be good for everybody. That's all we are 
after. That's all we have ever wanted. That 
is the fundamental basis of our foreign 
policy. 

Q. Well, how about general disarmament? 

THE PRESIDENT. It is in the same category. 

Q. Can they be considered together, Mr. 
President? 

THE PRESIDENT. No, they caunot. 

Q. Are you intending to say that you 
think public discussion does no good? 

THE PRESIDENT. No, I am not. You 
needn't put words of that kind into my 
mouth. I will answer your questions 

Q. I thought I was asking one 

THE PRESIDENT. All right, procced. You 
don't put any words in my mouth. 

Q. Do you think that public discussion 



will answer the situation? 

THE PRESIDENT. Public discussion helps 
every situation. 

Q. Mr. President, I didn't quite get that. 
You said disarmaments are in the same 
category as what? 

THE PRESIDENT. As atomic control. They 
are. We are for both. 

Q. Mr. President, you said we are not 
ready to consider atomic disarmament or 
atomic agreement and general disarmament 
together? 

THE PRESIDENT. They go together. They 
are both in the same resolution in the United 
Nations, if you will read it. They do go 
together. 

Q. We are for atomic agreement first? 

THE PRESIDENT. I would like to have that 
atomic thing first, of course, but they are 
both in the same resolution in the United 
Nations. 

Q. Are we inflexible on that point, Mr. 
President? 

THE PRESIDENT. Doesu't mean inflexible. 
If we can get an atomic energy setdement, 
we won't have any trouble with the other. 

Q. Mr. President, do you think that the 
Fuchs case possibly aggravates the inter- 
national situation with respect to atomic 
energy? ' 

THE PRESIDENT. I have uo commcut on 
that. 

Q. Couldn't hear that question. 

THE PRESIDENT. He Wanted to know if 
this English scientist's case had any effect on 
that, and I said I can't comment on that. 

Reporter: Thank you, Mr. President. 

note: President Truman's two hundred and six- 
teenth news conference was held in his office at the 
White House at 4 p.m. on Thursday, February 9, 
i95o« 

*Dr. Klaus Fuchs, German-born, naturalized 
British scientist convicted of having transmitted 
secret atomic information to the Soviet Union. 



41-355- 



153 



[35] Feb. II 



Public Papers of the Presidents 



35 Letter to the Attorney General Directing Him To Petition for an 
Injunction in the Coal Strike. February ii, 1950 



My dear Mr, Attorney General: 

On February 6, 1950, by virtue of the au- 
thority vested in me by Section 206 of the 
Labor Management Relations Act, 1947 
(Public Law loi, 8oth Congress), I issued 
Executive Order No. 10106, creating a Board 
of Inquiry to inquire into the issues involved 
in a labor dispute between coal operators and 
associations signatory to the National Bitu- 
minous Coal Wage Agreement of 1948, 
amending and extending the National Bitu- 
minous Coal Wage Agreement of 1947, and 
certain of their employees represented by the 
International Union, United Mine Workers 
of America, also signatory to the said 
agreement. 

On February 11, 1950, I received the 
Board's written report in the matter, includ- 
ing a statement of the facts with respect to 
the dispute and each party's statement of its 
position. A copy of that report is attached 
hereto. 

In my opinion this unresolved labor dis- 
pute has resulted in a strike affecting a sub- 
stantial part of an industry engaged in trade 
and commerce among the several States and 
with foreign nations, and in the production 
of goods for commerce, which strike, if per- 
mitted to continue, will imperil the national 
health and safety. 

I therefore direct you, pursuant to the 
provisions of Section 208 of the Labor Man- 
agement Relations Act, 1947, to petition in 
the name of the United States any district 



court of the United States having jurisdic- 
tion of the parties to enjoin the continuance 
of such strike, and for such other relief as 
may in your judgment be necessary or 
appropriate. 

Very sincerely yours, 

Harry S. Truman 

[Honorable J. Howard McGrath, The Attorney 
General, Washington, D.C.] 

note: Executive Order 10 106 is entitled "Creating 
a Board of Inquiry to Report on a Labor Dispute 
Affecting the Bituminous Coal Industry of the 
United States" (3 CFR, 1 949-1 953 Comp., p. 300). 
The Board's report, submitted on February 11 by 
David L. Cole, chairman, and John T. Dunlop and 
W. Willard Wirtz, members, is entiried "Report to 
the President: The Labor Dispute in the Bituminous 
Coal Industry" (8 pp., Government Printing Office, 

1950). 

The report revievi^ed the negotiations which had 
been carried on during the previous 8 months and 
stated that the parties had been more concerned 
with gaining tactical advantages than with trying 
to solve their problems by reaching an agreement. 
It concluded that the imperative needs of the coun- 
try were such as to require the immediate resump- 
tion of the production of coal. 

The report was followed on the same day by a 
Federal court injunction against the continuance of 
the strike. When the miners refused to return to 
work, the Government initiated contempt proceed- 
ings against the union. On March 2 the Federal 
district court in Washington, D.C., found the union 
not guilty on the ground that the Government had 
failed to produce sufficient evidence to support its 
charges. 

The controversy ended on March 5 with the sign- 
ing of a new contract between the mine operators 
and the miners. 

See also Items 27, 49, and 50. 



154 



Harry S. Truman, igp 



Feb. 13 [36] 



36 Special Message to the Congress Transmitting Report on the 
Training of Veterans Under the Servicemen's 
Readjustment Act. February 13, 1950 



To the Congress of the United States: 

In the Budget Message for 195 1, I stated 
that there is some question whether some of 
the training being received by veterans un- 
der the Servicemen's Readjustment Act is 
conforming to the original sound objectives 
of the law. I also said that I had asked the 
Administrator of Veterans Affairs and the 
Director of the Bureau of the Budget to 
study this situation thoroughly and to rec- 
ommend to me any corrective measures, ad- 
ministrative or legislative, which should be 
taken to assure that our expenditures for this 
program yield a proper return both to the 
veterans and to the Nation as a whole. 

The contribution which the Servicemen's 
Readjustment Act has made to the postwar 
development of the Nation's most important 
resource — its young men and women — ^is 
very great. It is now approximately four 
years after general demobilization. During 
these four years the overwhelming propor- 
tion of all veterans have completed their 
readjustment or moved far in that direction. 
For the great majority of those who have 
made use of the education and training pro- 
visions of the Servicemen's Readjustment 
Act, the law has been of real and lasting 
service. A great deal of fine education and 
training has been provided. The Nation 
will be better prepared to face the difficult 
problems of the future because of the im- 
proved education and skills provided to mil- 
lions of its worthy and capable young men 
and women. 

Because the law has contributed eflfectively 
to the successful transition of so many vet- 
erans, I am confident that veterans and non- 
veterans alike will wish to see that the 



record of the Servicemen's Readjustment Act 
shall not be blemished by the belated growth 
of certain kinds of trade and vocational 
training which do not contribute materially 
to the prompt and constructive readjustment 
of veterans. It was this conviction which 
led me to ask for a careful study of this 
aspect of the veterans' training program. 

The Administrator of Veterans Affairs and 
the Director of the Bureau of the Budget 
have now reported to me. Their report 
makes it clear that the recent rapid increase 
in trade and vocational training has included 
training of less than acceptable quality. In a 
number of cases, veterans have not received 
instruction which meets reasonable stand- 
ards. In a good many instances veterans 
have been trained for occupations for which 
they are not suited or for occupations in 
which they will be unable to find jobs when 
they finish their training. 

It seems evident that each time a course 
of trade and vocational training does not 
contribute in a substantial way to the oc- 
cupational readjustment of a veteran, it con- 
stitutes a failure of that portion of the pro- 
gram. Such failure is cosdy to the veteran, 
to his family, and to the Nation. While 
nothing that we may do can entirely elimi- 
nate such failures, I feel that steps can and 
should be taken to give greater assurance that 
every trade and vocational course under the 
Servicemen's Readjustment Act will provide 
good quality training and will in each in- 
stance help a veteran to complete his occu- 
pational readjustment and find satisfactory 
employment. 

The report of the Administrator of Vet- 
erans Affairs and the Director of the Bureau 



155 



[36] Feb. 13 



Public Papers of the Presidents 



of the Budget, which I transmit herewith, 
contains recommendations to achieve this 
purpose. I commend the report to the Con- 
gress. In the interest of veterans as indi- 
viduals and in the interest of the Nation, 
I urge that the Congress take suitable action, 
as it has done previously with respect to other 
types of training, to assure that all trade and 
vocational training conforms with the origi- 



nal sound intent of the Servicemen's Re- 
adjustment Act. 

Harry S. Truman 

note: The joint report of the Administrator of 
Veterans Affairs and the Director of the Bureau of 
the Budget is printed in House Document 466 (8ist 
Cong., 2d sess.). 

On July 13, 1950, the President approved the 
Veterans* Education and Training Amendments of 
1950 (64 Stat. 336). 



37 Address Before the Attorney General's Conference on 
Law Enforcement Problems. February 15, 1950 



Mr. Attorney General, and gentlemen of the 
Conference: 

When the Attorney General told me of his 
plan to hold this Conference, I welcomed 
the idea. It seemed to me that it v^rould be 
most useful for Federal, State, and local 
oflScials concerned with law enforcement 
problems to gather together to devise ways 
and means of making law enforcement better 
and more effective. 

There has been a substantial postwar in- 
crease in crime in this country, particularly 
in crimes of violence. This is disturbing, 
but it is one of the inevitable results of war, 
and the dislocations that spring from war. 
It is one of the many reasons why we must 
work with other nations for a permanent 
peace. 

I might remind you that after every war 
this country has ever been engaged in, we 
have had exactly the same problems to face. 
After the Revolutionary War we had al- 
most exacdy the same problems with which 
we are faced now, out of which came the 
Alien and Sedition laws, which we finally 
had to repeal because they did not agree with 
the Bill of Rights. Then, after the War 
Between the States, or the Civil War, we 
had all sorts of banditry. My State was 
famous for some of the great bandits of that 
time, if you recall. We had the same situa- 



tion after World War I. We had a terrible 
time then with the increase in crimes of 
violence. We managed to handle the situa- 
tion, and I am just as sure as I stand here 
that we will do it again. 

This postwar increase in crime has been 
accompanied by a resurgence of underworld 
forces — ^forces which thrive on vice and 
greed. This underworld has used its re- 
sources to corrupt the moral fiber of some of 
our citizens and some of our communities. 
It carries a large share of the responsibility 
for the general increase in crime in the last 
few years. 

This is a problem that, in one degree or 
another, affects every community in the 
country, and every level of government. 
Our rural areas as well as our cities are 
involved in this. 

It is important, therefore, that we work 
together in combating organized crime in all 
its forms. We must use our courts and our 
law enforcement agencies, and the moral 
forces of our people, to put down organized 
crime wherever it appears. 

At the same time, we must aid and en- 
courage gentler forces to do their work of 
prevention and cure. These forces include 
education, religion, and home training, 
family and child guidance, and wholesome 
recreation. 



156 



Harry S. Truman, ig^o 



Feb. 15 [37] 



The most important business in this 
Nation — or any other nation, for that mat- 
ter — is raising and training children. If 
those children have the proper environment 
at home, and educationally, very, very few 
of them ever turn out wrong. I don't think 
we put enough stress on the necessity of 
implanting in the child's mind the moral 
code under which we live. 

The fundamental basis of this Nation's 
law was given to Moses on the Mount. The 
fundamental basis of our Bill of Rights 
comes from the teachings which we get from 
Exodus and St. Matthew, from Isaiah and 
St. Paul. I don't think we emphasize that 
enough these days. 

If we don't have the proper fundamental 
moral background, we will finally wind up 
with a totalitarian government which does 
not believe in rights for anybody except the 
state. 

Above all, we must recognize that human 
misery breeds most of our crime. We must 
wipe out our slums, improve the health of 
our citizens, and eliminate the inequalities 
of opportunity which embitter men and 
women and turn them toward lawlessness. 
In the long run, these programs represent 
the greatest of all anticrimc measures. 

And I want to emphasize, particularly, 
equality of opportunity. I think every child 
in the Nation, regardless of his race, creed, 
or color, should have the right to a proper 
education. And when he has finished that 
education, he ought to have the right in 
industry to fair treatment in employment. 
If he is able and willing to do the job, he 
ought to be given a chance to do that job, 
no matter what his religious connections are, 
or what his color is. 

I am particularly anxious that we should 
do everything within our power to protect 
the minds and hearts of our children from 
the moral corruption that accompanies or- 
ganized crime. Our children are our great- 



est resource, and our greatest asset — ^the hope 
of our future, and the future of the world. 
We must not permit the existence of condi- 
tions which cause our children to believe 
that crime is inevitable and normal. We 
must teach idealism — ^honor, ethics, decency, 
the moral law. We must teach that we 
should do right because it is right, and not 
in the hope of any material reward. That 
is what our moral code is based on: do to 
the other fellow as you would have him do 
to you. If we would continue that all 
through our lives, we wouldn't have orga- 
nized crime — ^if everybody would do that. 

Our local. State, and Federal law enforce- 
ment agencies have a major role to play in 
this whole task of crime suppression. 

As law enforcement officers you have great 
powers. At the same time you must never 
forget that hand in hand with those powers 
go great responsibilities. You must make 
certain that these powers are not used for 
personal gain, or from any personal motive. 
Too often organized crime is made possible 
by corruption of law enforcement officials. 

But, far more than that, we must always 
remember that you are officers of the law in 
a great democratic nation which owes its 
birth to the indignation of its citizens against 
the encroachment of police and governmen- 
tal powers against their individual freedoms. 

Now there isn't any difference, so far as I 
can see, in the manner in which totalitarian 
states treat individuals than there is in the 
racketeers' handling of these lawless rackets 
with which we are sometimes faced. And 
the reason that our Government is strong, 
and the greatest democracy in the world, is 
because we have a Bill of Rights. 

You should be vigilant to enforce the laws 
which protect our citizens from violence or 
intimidation in the exercise of their constitu- 
tional and legal rights. The strength of our 
institutions depends in large measure upon 
the vigorous efforts to prevent mob violence. 



157 



[37] Feb. 15 



Public Papers of the Presidents 



and other forms of interference with basic 
rights — the right to a fair trial, the right to 
vote, and the right to exercise freedom of 
speech, assembly, and petition. 

It is just as much your duty to protect the 
innocent as it is to prosecute the guilty. The 
friendless, the weak, the victims of prejudice 
and public excitement are entitled to the 
same quality of justice and fair play that the 
rich, the powerful, the well-connected, and 
the fellow with pull thinks he can get. 

Moreover, the guilty as well as the inno- 
cent are entitled to due process of law. They 
are entided to a fair trial. They are entitled 
to counsel. They are entitled to fair treat- 
ment from the police. The law enforcement 
officer has the same duty as the citizen — 
indeed, he has a higher duty — ^to abide by 
the letter and spirit of our Constitution and 
laws. You yourselves must be careful to 
obey the letter of the law. You yourselves 
must be intellectually honest in the enforce- 
ment of the law. 

Now as President of the United States, I 
have the most honorable and the greatest 
job in the world — the greatest position that 
can come to any man on earth. I am in- 
vested with certain great powers by the Con- 
stitution of the United States in the opera- 
tion of the Government of the United States. 
But I was put into this place by the people of 
the United States. I am the servant of the 
people. And in the first place, I am a citizen 
of this great country. And as a citizen it 
is my duty as President of the United States 
to be exceedingly careful in obedience to the 
Constitution and the laws of this great 
Nation. 

I believe that as President it is necessary 
for me to be more careful in obeying the laws 
than for any other person to be careful. I 
never infringe a traffic rule. I never exer- 
cise the prerogatives which I sometimes have 
of going through red lights. I never exer- 
cise the prerogative of taking advantage of 



my position as President of the United States, 
because I believe, first, that I am a citizen, 
and that as a citizen I ought to obey the laws 
first and foremost. 

And every one of you has that same re- 
sponsibility. You yourselves, as I said, must 
be intellectually honest in the enforcement 
of the Constitution and the laws of the 
United States. And if you are not, you are 
not a good public official. 

I know that it would be easier to catch and 
jail criminals if we did not have a Bill of 
Rights in our Federal and State constitutions. 
But I thank God every day that it is there, 
that that Bill of Rights is a fundamental law. 
That is what distinguishes us from the 
totalitarian powers. I am confident that you 
share these convictions with me, and that 
you will not lose sight of them in your efforts 
to wipe out organized crime and reduce 
lawlessness. 

I know that your discussions here will be 
fruitful. I hope that you develop a sound 
plan by means of which the cooperative ef- 
forts of every American law enforcement 
agency will be efiFectively brought to bear 
upon organized crime. 

Your task does not end with today's meet- 
ing. It only begins with today's meeting. 
The spade work must be done in the com- 
munities where you live and work. It will 
be your task to mobilize local opinion and 
resources against organized crime and the 
conditions which create it. 

In this task I pledge my wholehearted 
support. 

Thank you very much. 

note: President Truman spoke at 10:05 a-^* i^ the 
Department of Justice Auditorium in Washington. 
In his opening words he referred to J. Howard 
McGrath, Attorney General of the United States. 

Among the organizations participating in the 
I -day conference were the Department of Justice, 
the National Association of Attorneys General of 
the United States, the United States Conference of 
Lawyers, and the National Institute of Municipal 
Law Officers. 



158 



Harry S. Truman, igp 



Feb. i6 [38] 



38 The President's News Conference of 
February 16, 1950 



THE PRESIDENT. Gentlemen, I have no par- 
ticular announcements to make. If you 
have any questions, I vi^ill try to answer 
them. 

[i.] Q. Mr. President, you wtXQ quoted 
yesterday as having said that if it had not 
been for the 1948 campaign, you would have 
sent Justice Vinson to Moscow, and that 
maybe that would be a thing to do sometime 
in the future. Is that correct? ^ 

THE PRESIDENT. Did you read the quota- 
tion in the paper, Smitty? ^ 

Q. Yes, sir. 

THE PRESIDENT. Read it again. That will 
answer your question. 

Q. Well, that is 

THE PRESIDENT. Read it again. That will 
answer your question. 

[2.] Q. Mr. President, was that inter- 
view authorized in that form? 

THE PRESIDENT. It WaS. 

Q. Mr. President, does that represent a 
softening of your attitude toward columnists, 
and vice versa? 

THE PRESIDENT. No, it doeS UOt. 

[The White House Official Reporter stated that 
there tvas a period of silence at this point. 1 

May I say to you gentlemen right now — 
you seem to be in a kind of disgruntled mood 
this morning — that the President is his own 

* The reporter was referring to an exclusive inter- 
view that the President had granted to Arthur 
Krock, chief Washington correspondent of the New 
York Times, on February 14. 

In his report of the interview, Mr. Krock quoted 
the President as having said that he would have 
sent Chief Justice Fred M. Vinson to Moscow in the 
fall of 1948 except for the political campaign then 
in progress and that perhaps he might send him 
on such a mission sometime in the future. 

The text of the interview, as printed in the New 
York Times on February 15, is also published in 
the Congressional Record (vol. 96, p. A 1272). 

* Merriman Smith of the United Press Associations. 



free agent. He will see whom he pleases, 
when he pleases, and say what he pleases to 
anybody that he pleases. And he is not cen- 
sored by you, or anybody else. 

I have tried my best to be as courteous to 
you gentlemen as I possibly can be, and I 
expect to continue that. But I don't like 
your attitude this morning, so just cool ofE. 
[Laughter] 

Q. Mr. President, inasmuch as I am not 
disgruntled 

THE PRESIDENT. Of course you are not — of 
course you are not. 

Q. 1 might say to you, sir, as I used 

to work in the newspaper game — {laugh- 
ter] — that that particular type of thing is 
a — these fellows feel, I think, that it is a 
reflection on every bureau chief and reporter 
in the White House 

THE PRESIDENT. It is nothing of the kind. 

Q. I beg your pardon.? 

THE PRESIDENT. It is nothing of the kind. 

Q. That is their attitude, and I hope that 
you will pardon me if I bring that to your 
attention? 

THE PRESIDENT. That's all right, but it's 
nothing of the kind. But I don't stand for 
anybody to edit my actions. I am a free 
agent, even if I am the President of the 
United States. 

Q. Mr. President, did you intentionally 
omit "damn".? 

THE PRESIDENT. Ycs, I Intentionally 
omitted it. I could put it in, if you would 
like to have it. [Laughter] 

Q. Where should it go in, Mr. President — 
the "damn".? 

THE PRESIDENT. What.? 

Q. Where does it go in.? 
THE PRESIDENT. Put your question in, and 
I will edit it for you. [More laughter] 
Now then, have you got any questions 



159 



[38] Feb. i6 



Public Papers of the Presidents 



that I can answer sensibly? If you have, I 
will listen to them. 

Q. Fm sorry — ^I think this is not a criti- 
cism of your right to do as you please, but 
of our understanding as to whether others 
may also obtain exclusive and private inter- 
views? 

THE PRESIDENT. That remains to be seen. 
I will cross that bridge when I get to it. 

[3.] Q. Mr. President, getting back to 
this question — ^that direct question which 
Mr. Smith just asked, you were quoted in this 
interview as saying that you might have sent 
Chief Justice Vinson to try to straighten out 
Stalin and other Russian leaders on our real 
intentions. Then you were quoted as saying 
maybe that will be the thing to do sometime. 
How about this question, sir ? Do you think 
that time has come? 

THE PRESIDENT. No, I do nOt. 

[4.] Q. Mr. President, could I return 
with the feeling only of wanting informa- 
tion 

THE PRESIDENT. Sure. I will give you any 
information I can — ^that I am capable of. 

Q. ^that your giving of interviews goes 

by favor, and there is no longer a rule? We 
were under the impression that there was a 
rule which had — custom, at least, which had 
the binding force of a rule? 

THE PRESIDENT. It is a custom. I will con- 
tinue that custom 

Q. But you will 

THE PRESIDENT. ^but I wiU do as I pleasc 

with regard to breaking it. [Laughter^ 

Q. Yes sir. That is the information that 
I want. 

THE PRESIDENT. That is the answer. You 
have the information. And I am not dis- 
gruntled in the slightest. [More laughter] 

Q. Why should you be? 

THE PRESIDENT. I am in as good a humor 
as I can possibly be, but I would like to 



answer some questions that have a bearing 
on the present situation. 

Q. I will give you one, Mr. President. 

Q. You think our business is quite im- 
portant, do you? 

THE PRESIDENT. Sometimes I am not so 
sure. 

Q. Mr. President, can you 

THE PRESIDENT. What is it? 

[5.] Q. Mr. President, one of your 

callers yesterday said that he got the impres- 
sion that you plan to campaign extensively 
this year, after the nominees were in. He 
mentioned the States of Ohio and Pennsyl- 
vania? 

THE PRESIDENT. I think I made a statement 
to this press conference sometime back that 
I was not dabbling in any Democratic pri- 
maries outside of the State of Missouri, but 
that after the primaries were over I will be 
willing to help the Democrats to win in any 
State in the Union. 

Q. Could you tell us 

THE PRESIDENT. That is aloug the same 
line. 

Q. Yes. Inasmuch as he mentioned two 
States, could you mention perhaps some 
other States? 

THE PRESIDENT. No. Let's attend to that 
when we get to it. I will take you on a 
nonpolitical tour, one of these days, and 111 
show you. [Laughter] 

[6.] Q. Mr. President, about that Mis- 
souri primary, have you got any word 
whether Forrest Smith is going to be at the 
dinner tonight? ^ 

THE PRESIDENT. I beg your pardon? 

Q. Have you got any word as to whether 
Forrest — Governor Smith will or will not be 
at the dinner tonight? 

THE PRESIDENT. He wiU be at the dinner. 

Q. He will be at the dinner? 

'Jefferson-Jackson Day Dinner. Sec Item 39. 



160 



Harry S. Truman, ig^o 



Feb. i6 [38] 



THE PRESIDENT. He wiU bc at the dinner. 
At least, if the weather is good to fly in this 
morning he will be there. 

Q. Mr. President, he wired John Hen- 
dren ^ that the National Guard wouldn't let 
him take ofl. 

THE PRESIDENT. That was yesterday, not 
today. 

Q. Has the weather changed? 

THE PRESIDENT. There is not — ^I don't 
know — ^you know, weather conditions 
change from day to day. I rather think he 
will be here. 

[7.] Q. Mr. President, do you have any 
comment on the agreement between Russia 
and the Communist government of China? 

THE PRESIDENT. I have no comment, for I 
haven't myself personally — I haven't read 
the treaty and don't know what it contains. 
I think Dean Acheson covered the matter 
very well yesterday.*^ 

[8.] Q. Mr. President, do you approve 
of the selling of hundred-dollar tickets for 
tonight's dinner to civil service employees 
who are nonpolitical employees? 

THE PRESIDENT. If they waut to buy a 
ticket, they are at liberty to buy one. I 
don't think their civil rights have been in- 
fringed upon in the slightest. 



*John H. Hendren, chairman, Missouri Demo- 
cratic State Committee. 

"The New York Times reported on February 16 
that Secretary Acheson, in his press conference of 
February 15, had warned the Chinese people that 
their troubles with the Soviet Union had only begun 
with the signing of the Sino-Soviet Pact. The 
treaty of alliance between the two countries was 
signed in Moscow on February 15. 

Secretary Acheson was quoted as saying that even 
if the full sum of the Soviet Union's promised eco- 
nomic aid — ^$300 million over a 5-year period — ^was 
forthcoming, it would be meager in comparison with 
the great economic needs of China. He further 
stated that the most significant features of the new 
agreements were probably covered by secret proto- 
cols that would never bc made public, but that 
could be measured only by Russian conduct in 
China in the months and years to come. 



[9.] Q. Mr. President, speaking of civil 
rights, don't you think that a Federal law 
against bigtime gambling is just as important 
as Federal laws against lynching 

THE PRESIDENT. Well uow, that is a matter 
that will have to be worked out by the At- 
torney General. That is not in my immedi- 
ate department. I am not a criminal en- 
forcement officer. I will take the advice of 
the Attorney General on the subject. 

Q. Mr. President, have you ever advocated 
a Federal law against gambling? 

THE PRESIDENT. No. I uevcr — it has uever 
come up for consideration. 

Q. I do not understand the question. 

THE PRESIDENT. No. No, it has nevcr 
come up for consideration. I think all sorts 
of lawlessness ought to be stopped by any 
measure that is possible to stop it. I think, 
in enforcing the Federal law, that we must 
always be careful that the civil rights part 
of the Constitution is not infringed upon. 
That is what I tried to make perfecdy clear 
in my speech yesterday.® 

Q. I beg your pardon — ^in this particular 
jurisdiction, where we have two or three 
counties — ^two States and a Federal jurisdic- 
tion — ^District of Columbia — ^we have found 
here, according to the grand jury, that it is 
impossible to enforce laws against gambling 
without the addition of some interstate mat- 
ter or help of the Federal Government. That 
is the report of the grand jury. 

THE PRESIDENT. WcU, that ought to be 
remedied. 

Q. You understand about that? 

THE PRESIDENT. Yes. That ought to be 
remedied. 

Q. That ought to be remedied ? 

THE PRESIDENT. That ought to be rem- 
edied, of course. 

[10.] Q. Mr. President, do you agree 
with Mr. Churchill that another top level 
•item 37. 



41-355— ^©5 



-14 



161 



[38] Feb. 16 



Public Papers of the Presidents 



conference with Mr. Stalin might achieve 
some resuhs? ^ 

THE PRESIDENT. I have no comment to 
make on Mr. Churchill's statement. I have 
always said that the door is open here in 
Washington. Any time any head of state 
wants to come and visit me, he is welcome. 

Q. You still want it to be held here in 
Washington? 

THEPRESmENT. Ycs. 

Q. Mr. President, do you think Mr. 
Churchill is just electioneering? 

THE PRESIDENT. That qucstiou I do not 
want to answer. 

[11.] Q. Mr. President, did you tell 
Charles Luckey ® that you might be a can- 
didate for President? 

THE PRESIDENT. He drew that conclusion. 
[Laughterl 

Q. Did you indicate to him that you might 
be a candidate? 

THE PRESIDENT. He drew that conclusion. 
[Laughter] 

[12.] Q. To return to Missouri politics 
once more, Chairman John Hendren told a 
group of Missouri Democrats at luncheon 
yesterday that it is his understanding that 
the Hatch Act will not prohibit Government 
workers from joining the Missouri State 
Democratic clubs, that they could not be 
solicited while at work but they could solicit 
them at home. 

THE PRESIDENT. I think the Government 
employee, when he is through with his Gov- 
ernment work, can do anything he pleases 
that does not infringe upon the criminal law. 

^The New York Times reported on February 15 
that former British Prime Minister Winston S. 
Churchill spoke at Usher Hall in Edinburgh, Scot- 
land, on February 14. The Times quoted Mr. 
Churchill as stating that a new "top level" attempt 
to reach an agreement with the Soviet Union for the 
control of the atomic bomb and an end to the cold 
war should be instigated. 

® George (Charles) Luckey, vice chairman of the 
California Democratic State Committee. 



I think he has the same rights as any other 
citizen of the United States, and if he hasn't 
he ought to have. 

Q. Mr. President, the Hatch Act— that 
doesn't say that.f* 

THE PRESIDENT. The Hatch Act is specific 
in that particular. You ought to read it very 
carefully. I am pretty familiar with the 
Hatch Act, for I was there when it passed, 
and I voted against section nine, -which is 
the one to which this refers. 

[i3'] Q' Mr* President, in your discus- 
sion yesterday with Mayor Lawrence of Pitts- 
burgh, did the mayor give you a very prom- 
ising picture of Pennsylvania.? 

THE PRESIDENT. Ycs, he did. Yes, he did. 

Q. Do you think Senator Francis J. Myers 
will be elected.? 

THE PRESIDENT. Yes, and I hope he will. 

[14.] Q. Mr. President, do you have any 
hopes that the miners will go back to work 
under the injunction 

THE PRESIDENT. Well, I dou't waut to com- 
ment on that, because that is a matter that 
is in the courts, and the courts will have to 
handle it. 

[15.] Q. Mr. President, did Mr. Luckey 
draw the correct conclusion.? 

THE PRESIDENT. That qucstiou will have 
to be — ^you will have to wait awhile for the 
correct answer to that question. 

Q. Didn't hear that answer, sir. 

THE PRESIDENT. He Wanted to know if 
Mr. Luckey drew the correct conclusion, and 
I told him you would have to wait awhile 
to see whether his conclusion was right or 
not. 

[16.] Q. Mr. President, your Solicitor 
General, Mr. Perlman, filed a brief last 
Thursday regarding two schools in Okla- 
homa and Texas; and at the time I asked you 
if you had seen it and you said you had not. 
Is that brief the official view of the adminis- 
tration? 



162 



Harry S. Truman, ig$o 



Feb. i6 [38] 



THE PRESIDENT. I havcii't read the brief, 
and I don't know what is in it, and I can't 
answer your question now any more than I 
could last week. 

[17.] Q. Mr. President, Mr. Green and 
Mr. Murray ^ were in to see you a few days 
ago, and they asked you to do something 
about British arms shipments to the Arabs. 

THE PRESIDENT. They brought me in a 
letter signed by both of them, and I referred 
it to the State Department. 

Q. Would you care to comment on it? 

THE PRESIDENT. No. 

[18.] Q. Mr. President, could you com- 
ment on Senator Joseph R. McCarthy's state- 
ment that there are 57 Communists in the 
State Department? 

THE PRESIDENT. I think the State Depart- 
ment answered that by saying there was not 
a word of truth in what the Senator said. 

[19.] Q. Mr. President, what is your feel- 
ing toward the Adantic Union proposal now 
being discussed on the Hill? 

THE PRESIDENT. I am not familiar enough 
with it to comment on it. I don't think now 
is the proper time to press a thing of that 
sort. We have other things much more im- 
portant right now. 

[20.] Q. Mr. President, do you feel there 
would be any value in — propaganda-wise or 
otherwise — a somewhat more dramatic move 
than the State Department's, by the Assistant 
Secretary of State, that we are still ready to 
negotiate on the atomic control? 

THE PRESIDENT. What do you mean by 
that? The negotiating machinery in the 



* William Green, president of the American Fed- 
eration of Labor, and Philip Murray, president of the 
Congress of Industrial Organizations. 



United Nations and our Ambassadors in all 
the capitals of the world are always ready 
to discuss any questions with any state when 
they want to discuss them with us. The 
door has always been open. We have never 
walked out of any meetings. We have never 
used the veto power for the purpose of pre- 
venting peace in the world. Why don't you 
read a litde history? Our doors are always 
open. Wc are ready to talk with anybody 
on any subject that will contribute to peace. 
I don't think it needs any showmanship to 
carry that through. 

Q. Mr. President, the reason — feeling that 
that had been your constant position was one 
of the reasons we were astonished at the 
reference to Vinson in the Krock interview. 

THE PRESIDENT. I don't think you should 
be astonished. Read it very carefully. It 
did not astonish anybody at the time. 

[21.] Q. Mr. President, the CIO execu- 
tive board early this week urged you to fire 
Mr. Denham.^° Are you considering that? 

THE PRESIDENT. No, I am not. 

Q. Mr. President, have you power to fire 
Mr. Denham? 

THE PRESIDENT. If I have the power to ap- 
point, I have the power to dismiss, except 
if the law provides that it can't be done. 
You will find that is the decision of the courts 
all the way down. 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You're welcomc. 

note: President Truman's two hundred and seven- 
teenth news conference was held in his office at the 
White House at 10:30 a.m. on Thursday, Febru- 
ary 16, 1950. 

^® Robert N. Denham, General Counsel, National 
Labor Relations Board. 



163 



[39] Feb. i6 



Public Papers of the Presidents 



39 Address at the Jefferson-Jackson Day Dinner. 
February i6, 1950 



Mr. Chairman, distinguished guests, and 
fellow Democrats: 

This is the most remarkable dinner I have 
ever seen. And during my 30 years in poli- 
tics, I have seen many a dinner. I have 
attended many Democratic meetings such 
as this, and I think this has been the grandest 
one of all. 

This dinner and others like it throughout 
the land are evidence of the growing 
strength of the Democratic Party. They 
show that our party is determined, more 
than ever before, to carry its message to the 
voters of this country. 

It is very significant that such great inter- 
est and enthusiasm are being shown in a 
congressional election year. We know that 
congressional elections are as important as 
presidential elections. We found that out 
in 1946. We found out just how much 
harm can be done to our country when a 
congressional election goes wrong. I am 
sure we are not going to let that happen 
again. We are not going to put ourselves 
in the position of electing another "do-noth- 
ing" 80th Congress. 

These dinners carry forward a great tra- 
dition. The original Jefferson-Jackson din- 
ner was held in this city in 1830, 120 years 
ago. It was given in memory of Thomas 
Jefferson, and its guest of honor was Andrew 
Jackson, President of the United States. At 
that first Jefferson-Jackson dinner. President 
Jackson gave his famous toast — "Our Fed- 
eral Union, it must be preserved!" 

Tonight, we meet again to think of our 
Federal Union, and to be thankful that it has 
been preserved, and find that it has grown 
in strength and in service to the people. As 
in Jackson's time, we meet to discuss some 
of the problems that our country faces. 



We have some very serious problems to- 
day. We are living in a troubled period of 
the world's history. Our responsibilities, as 
a Nation, have never been so great, and the 
decisions we face have never been more diflS- 
cult. We are confronted with serious ques- 
tions of foreign policy. We have the prob- 
lem of maintaining an adequate national 
defense. We have the task of maintaining 
prosperity and protecting our economy from 
depression. We have the question of han- 
dling the Nation's finances and the national 
debt. 

My fellow Democrats, these are grave is- 
sues. And the Democratic Party is meeting 
them squarely. We do not believe in tri- 
fling with the people about these issues. We 
do not offer to solve them with vague gen- 
eralities and wornout slogans. We know 
that the solution of these problems requires 
all the wisdom and energy we possess as a 
Nation. We know that their solution re- 
quires heavy expenditures. The Democratic 
Party does not propose to deceive the people 
either about the problems we face or about 
the cost of solving them. 

The Democratic Party has confidence that 
the United States will meet these great re- 
sponsibilities. It knows that the United 
States is a dynamic, growing nation. We 
believe that this country will make as much 
progress in the next 50 years as it has made 
in the last 50 years. 

But we cannot meet the responsibilities of 
today or the challenge of the future by fol- 
lowing the outmoded concepts of 50 years 
ago. The promise of the 20th century can- 
not be fulfilled by those who would like to 
return to the days of President McKinley. 

We must go forward with our programs 
for peace through defense and foreign aid. 



164 



Harry S. Truman, ig^o 



Feb. i6 [39] 



We must proceed with our domestic pro- 
grams for health, education, social security, 
and economic stability. Both our foreign 
programs and our domestic programs are 
necessary to answer the demands which this 
critical period of history makes upon this 
great United States. We cannot have pros- 
perity at home unless we play our full part 
in the defense and the revival of other free 
nations. We cannot have peace abroad un- 
less we increase the strength and freedom, 
and the well-being of our people here at 
home. 

There are some who would like to see us 
turn our backs upon the rest of the world 
and drop our efforts to strengthen our do- 
mestic economy. At the present time, they 
are spreading the mistaken idea that we can 
save money by going backward. They ad- 
vocate slashing our expenditures for peace 
and for our domestic programs. These peo- 
ple are blind to the problems that confront 
us. They cannot see that a tax cut would 
only help their own pocketbooks temporar- 
ily. They fail to see that in the long run 
false economy would endanger not only their 
pocketbooks but their lives and the continua- 
tion of civilization itself. 

It is true that our present expenditures are 
large. But the Democratic administration 
is working toward a balance in the Federal 
budget. I wish we could balance the budget 
immediately by the simple expedient of 
cutting expenses. My friends, that is out of 
the question. More than 70 percent of our 
Federal budget goes to pay for past wars and 
to work for peace in the future. Anyone 
who says that these expenditures are extrava- 
gant does not understand the kind of world 
we live in. Our other expenditures are less 
than one-third of the budget, and less in 
proportion to the national income than they 
were 10 years ago. 

I would like to cut expenditures further, 
and I intend to cut them at every oppor- 



tunity. But I do not propose to weaken the 
strength and security of this great country. 
I do not propose to place the peace of the 
world in jeopardy to satisfy the advocates of 
false economy. 

In this diflScult world situation, some 
people are talking about general tax reduc- 
tions. I regard this as rank political hypoc- 
risy. We had one recent experience with an 
ill-timed, irresponsible tax cut. Much of our 
present financial diflSculty is the result of the 
sweeping tax reduction which was enacted 
in 1948 over my veto — ^at a time when ex- 
penditures for defense and foreign policy 
were inevitably rising. I vetoed that tax 
bill three times, and I tried my best to explain 
to that **do-nothing" 8oth Congress that they 
were ruining the financial state of the coun- 
try. They thought they had a tremendous 
asset in that asinine tax cut, but it backfired 
on them. Now, we must not make the same 
mistake again. 

In this election year, the Democratic Party 
will not play politics with the Federal budget. 
We will state the honest truth about the 
budget, just as we will about all other issues. 
We believe that the people are entided to the 
plain facts about every issue, so that they can 
make up their own minds — ^just as they did 
in 1948. 

The Democratic Party can afford to be 
frank and truthful, because it is working for 
the general welfare of all our citizens. It 
does not serve any narrow group or clique. 
This makes it easy for the Democratic Party 
to put its program before the country openly 
and completely. We have nothing to hide 
from the people. Our strength lies in ex- 
plaining our program and our policies to the 
people. And the more thoroughly we ex- 
plain to them what the Democratic Party is 
trying to do, the more certain we can be of 
their continued support. 

There are many differences between the 
Democratic Party and the Republican Party.. 



165 



[39] Feb. 16 



Public Papers of the Presidents 



But I think the greatest difference is that the 
Democratic Party is the party of affirmative 
action — it is for measures to achieve pros- 
perity and progress. The Republican Party 
is the party of negative inaction — ^it is always 
against things. 

You know, I think the principal thing the 
Republicans are against, of course, is the 
Democratic Party. They just can't win on 
that plank alone. They must try to find 
reasons for being against the Democratic 
Party. They must persuade the people to 
vote against the Democratic Party. And 
that is getting harder and harder to do year 
by year. 

One of the reasons it's hard to do is that 
the Republican Party has no affirmative pro- 
gram of its own. It refuses to face the prob- 
lems of our economy. It refuses to take 
thought and to make plans for the future. 
Instead of presenting a positive program of 
their own, the Republicans sit around wait- 
ing for us to make a proposal, and they react 
with an outburst of scare words. They are 
like the cuttlefish that squirts out a black 
cloud of ink whenever its slumber is dis- 
turbed. We have disturbed the Republican 
sleepers many times in the last 18 years. 

Right now, the main problem of the Re- 
publican leaders seems to be to find some 
new scare words. They have not had much 
luck along that line, lately. They tried 
using the phrase "welfare state" as a scare 
word for a while, but they discovered that 
the people are in favor of a government that 
promotes their welfare. So they dropped 
that one as a scare slogan. Then they tried 
"statism." But my good friend Governor 
Lehman took care of that one in the New 
York election — and so they had to drop it, 
too. 

Now, the Republican leaders have to go 
back to an old standby. Frankly, I don't 
think it's as good as some of the others, but 
it appears to be the best they can think of. 



Their current scare word is "socialism." 

It's perfectly safe to be against "socialism." 
The difficult thing is to make the country 
beUeve that the Democratic Party stands for 
socialism. How in the world can the Re- 
publicans persuade people that all you Demo- 
crats at all these dinners are socialists? I 
just don't believe they can do it. 

I know it can't be done. But the Repub- 
licans will try it just the same. That's what 
they've been trying to do ever since 1933. 
For the last 17 years they have called every 
new Democratic measure "socialism" or 
"communism," and they have made constant 
predictions of doom and disaster. The plans 
and proposals that we have advanced for im- 
proving the conditions of the people of this 
country have been greeted by these same old 
scare tactics during all these years. 

And I'm going to prove that to you. 

Let us take it step by step. This is most 
interesting. 

In 1933, this country faced some of the 
greatest problems in its history — ^the prob- 
lems of providing food and work for millions 
of jobless persons and their families, of sav- 
ing millions of farms and homes from fore- 
closure, of restoring a banking system that 
had collapsed, of placing the entire economy 
on the way to recovery. 

The Democratic Party rolled up its sleeves 
and went to work. It took steps to provide 
relief and jobs, to save farms and homes, to 
restore banks and businesses. Bit by bit the 
economy responded to these vigorous meas- 
ures. Income began to grow, confidence re- 
turned, business activity mounted. This was 
the response of the economy to our farm and 
labor and business programs — our programs 
for resource development and public works 
and the building of homes. 

As this miracle of recovery unfolded, what 
was the attitude of the Republican Party? 

In 1934 — ^and I ran for the Senate in 1934, 
and I remember this well — the Republican 



166 



Harry S. Truman, igp 



Feb. i6 [39] 



National Committee issued a policy state- 
ment — a policy statement. And in that 
statement they said: 

"American institutions and American 
civilization are in greater danger today than 
at any time since the foundation of the 
republic." 

That sort of talk may have frightened the 
members of the Union League Club. But it 
didn't frighten the people who had been 
saved by the New Deal from breadlines and 
bankruptcy. 

In 1936, the Republicans thought the dan- 
ger was worse. That was when President 
Roosevelt was running for his second term. 
In that year, the Republican platform cried 
out: 

"America is in peril. The welfare of 
American men and women and the future 
of our youth are at stake. . . . The New 
Deal administration" — ^this is from the 1936 
Republican platform — "The New Deal ad- 
ministration has bred fear and hesitation in 
commerce and industry, thus discouraging 
new enterprises, preventing employment, 
and prolonging the depression." 

People weren't scared by that one either. 
They knew it just didn't make sense, because 
the national income had risen more than 50 
percent in the previous 4 years, and it was 
still rising. 

In 1940, the Republicans tried to scare us 
again. This time their platform said: 

"The Administration has imposed upon 
us a regime of regimentation which has de- 
prived the individual of his freedom and has 
made of America a shackled giant. . . . The 
New Deal administration has failed 
America." 

That's what the Republicans said, but the 
America that the New Deal had saved — the 
economy that the New Deal had freed and 
made productive again — became the arsenal 
of democracy that overwhelmed the forces 
of totalitarian aggression. 



But that still didn't teach the Republicans 
anything. In 1944, when we stood at the 
peak of our wartime production — ^the eco- 
nomic bulwark of the free world — the Re- 
publican Party platform proclaimed: "The 
fact remains that under the New Deal, Amer- 
ican economic life is being destroyed." 
That's what they said in 1944 — "American 
economic life is being destroyed." 

Apparently, they never learn anything. 
Today, when we have a national output of 
over $250 billion a year and a higher stand- 
ard of living than ever before in the history 
of the world, the Republican Party still can- 
not see anything good about the situation. 
In their policy statement issued 10 days ago, 
the Republican National Committee de- 
clared: "The major domestic issue today is 
liberty against socialism: . . . Basic Amer- 
ican principles" — they said — "are threatened 
by the administration's program . . ." 

It's the same old story — the same old 
words, the same old music — ^the same empty 
and futile attempt to scare the American 
people — ^in complete contradiction of the 
plain facts that are visible to every citizen in 
his daily life to see. The country is not 
going to let them get away with it. Don't 
worry about it. 

For the past 17 years, the same outcry has 
greeted every proposal advanced by the 
Democratic Party — whether it has been for 
better housing, social security, rural electrifi- 
cation, farm price supports, minimum wages, 
or any other program for the general welfare 
of the people. 

They have been against all these proposals, 
but now they are for all of them. But, are 
they? Are they? I think they showed you 
conclusively what they would do if they had 
control of the Government when they had 
the 8oth Congress. 

In 1944, Representative Joseph W. Martin, 
Jr. — ^who was the Republican leader in the 
House, and who is the minority leader 



167 



[39] Feb. i6 



Public Papers of the Presidents 



now — summarized the Republican attitude 
toward all these progressive steps in one brief 
paragraph when he said: 

"For 1 1 years wc have been steadily drift- 
ing into a regimented nation, with absolute 
control vested in a power-mad group of 
bureaucrats and social planners. Unless 
there is a change in government this year 
we can be reconciled to some kind of totali- 
tarian government." That was in 1944. 

That is what the Republicans said about 
our program in 1944. That is the way they 
talked about our programs in 1948. That 
is what they are saying about them now. 

Today we are proposing further develop- 
ment of our resources, further strengthening 
of our economy, new measures for the wel- 
fare of the people. And what do we hear? 
The same old story. It is all repeated in that 
latest statement of the Republican National 
Committee: 

"This program" — ^they said, and they were 
talking about the program of the Democratic 
Party — ^not their own, for they haven't one — 
"This program is dictated by a small but 
powerful group of persons who believe in 
socialism, who have no concept of the true 
foundation of American progress, whose 
proposals are wholly out of accord with the 
true interests and the real wishes of the 
workers, farmers, and businessmen." That 
is a quotation from their very solemn policy 
statement. 

Well, let's look at the record. What is our 
program? Where did it come from? Our 
program is the platform adopted by the 
Democratic Party at its Convention in 1948. 
And it has been voted on by the people of 
this country, including the workers, farmers, 
and businessmen. 

If our program was dictated, as the Re- 
publicans say, it was dictated at the polls in 
November 1948. And it was dictated by a 
"small but powerful group" of 24 million 
voters. 



And I think they knew more than the 
Republican National Committee about the 
real wishes of the workers, farmers, and 
businessmen. What do you think? 

Now, of course, this program is not social- 
ism. It is based upon a firm faith in the 
strength of free enterprise. It is designed to 
strengthen the markets of free enterprise and 
to expand the investments of free enterprise. 
It will make our citizens economically secure, 
well educated, and confident of the future. 
Only in a nation of such citizens can free 
enterprise grow and expand and reach its 
full possibilities. 

The program of the Democratic Party is 
aimed to promote the prosperity and welfare 
of all the American people. It is aimed to 
increase the freedom of all the American 
people. 

Freedom is not an abstraction. Freedom 
is a reality in our daily lives. The programs 
of our party have freed workers from the 
economic subjection of their employers. 
These programs have freed farmers from the 
fear of bankruptcy. These programs have 
released farm wives from bondage and cease- 
less drudgery. These programs have freed 
older people from the fear of a dependent 
old age. 

These programs — our programs — look 
forward to the day when our people will be 
freed from fear of inadequate medical care 
from crushing medical expenses. They are 
aimed at freeing our young people from 
ignorance and a poor education. 

This is the record and the promise of the 
Democratic Party in expanding the freedom 
of the American people. But when the 
Republican Party proclaims that we are en- 
gaged in restricting freedom — ^that we are 
enemies of freedom — I ask, "Whose free- 
dom?" Let the American people look into 
their own lives and ask themselves whether 
they enjoy greater freedom or less than they 
did 18 years ago. 



168 



Harry S. Truman, igp 



Feb. 17 [40] 



About the only freedom we have limited 
is the freedom of Republicans to run the 
country. I have an idea that is what they 
are complaining about. 

For the Republicans to drag out the same 
old moth-eaten scarecrow of "socialism" 
again in 1950 — ^after having used it, or some- 
thing very like it, in opposition to every 
progressive step the Nation has taken since 
1933 — is an insult to the intelligence of the 
American people. Out of the great progress 
of this country, out of our great advances in 
achieving a better life for all, out of our rise 
to world leadership, the Republican leaders 
have learned nothing. Confronted by the 
great record of this country, and the tremen- 
dous promise of its future, all they can croak 
is "socialism!" 

The Democratic Party is going right ahead 
to meet the needs and carry out the aspira- 
tions of the American people. 

Our objective is to advance in freedom — 
to create a system of society that is even more 
responsive to the needs of the people — ^to 
establish democratic principles so firmly in 
the hearts of the people that they can never 
be uprooted. 

In the present anxieties and troubles of 
the world, the real strength of our country 
lies not in arms and weapons, important as 
they may be, but in the freedom of our citi- 



zens in their faith in a democratic society. 
Among the nations of the world we stand 
as an example of what free men can do when 
they are in control of their own affairs and 
dedicated to the concept of a better life for 
all. 

To work for. the prosperity, and welfare, 
and freedom of the American people is to 
work for the vindication of democratic in- 
stitutions everywhere. And it is only 
through the growth of democratic institu- 
tions that a just and lasting peace can finally 
be achieved. 

In this troubled world, it is more than ever 
important that the Democratic Party remain 
steadfast in its devotion to these ideals. It 
is more than ever important this year 
that the Democratic Party present its pro- 
gram to the people so plainly that it cannot 
be misunderstood. If we do that, I am 
confident that the people will again voice 
their approval of the principles which lead to 
increased prosperity, welfare, and freedom — 
not only for this country, but for all free 
nations of the world everywhere. 

note: President Truman spoke at 10:30 p.m. in 
the National Guard Arxnory in Washington. His 
opening words "Mr. Chairman" referred to Charles 
Luckman, chairman of the Jefferson-Jackson Day 
Committee. 

The address was broadcast over all major radio 
networks and was televised. 



40 Letter to Dr. Irvin L. Stewart on the Establishment of the 

President's Communications PoUcy Board. February 17, 1950 



My dear Dr, Stewart: 

Communications services represent a vital 
resource in our modern society. They make 
possible the smooth functioning of our com- 
plex economy; they can assist in promoting 
international understanding and good will; 
they constitute an important requirement for 
our national security. There is, accordingly, 



a major public interest in assuring the ade- 
quacy and efficiency of these services. 

Developments in this field during and 
since the w^ar have created a number of prob- 
lems which require careful consideration at 
this time. The extent to which the Gov- 
ernment should, in time of peace, continue 
to operate its own communications facilities 



169 



[40] Feb. 17 



Public Papers of the Presidents 



is one such problem of current importance. 
The question of merging the overseas opera- 
tions of our commercial communications 
companies also requires objective review. 
The most pressing communications problem 
at this particular time, however, is the scar- 
city of radio frequencies in relation to the 
steadily growing demand. Increasing diffi- 
culty is being experienced in meeting the 
demand for frequencies domestically, and 
even greater difficulty is encountered interna- 
tionally in attempting to agree upon the 
allocation of available frequencies among the 
Nations of the world. In the face of this 
growing shortage, the problem of assuring 
an equitable distribution of the available 
supply of frequencies among all claimants, 
both Governmental and private, is rapidly 
assuming major prominence. 

Problems such as these cannot adequately 
be considered on a piecemeal basis. They 
must be viewed as parts of the broader prob- 
lem of developing a total national communi- 
cations policy, designed to assure the most 
effective utilization of the various forms of 
communication facilities, and the full satis- 
faction of those needs which are most essen- 
tial to the broad public interest. An over-all, 
objective review of this entire situation is 
urgendy needed. 

I am therefore establishing by Executive 
order a temporary Communications Policy 
Board of 5 members to study and to make 
recommendations to me on the policies and 
practices which should be followed by the 
Federal Government in this field in order 
best to meet the broad requirements of the 
public interest. I am asking you to serve as 
Chairman of this Board. In view of the 
need for early action in this field, I should 
like to receive the Board's final report by no 
later than October 31, 1950. 

The Executive order establishing this 
Board states that the Board shall study the 



present and potential use of radio and wire 
communications facilities by governmental 
and non-governmental agencies. The Order 
further states that the Board shall make rec- 
ommendations in the national interest con- 
cerning (a) policies for the most effective 
use of radio frequencies by governmental and 
non-governmental users and alternative ad- 
ministrative arrangements in the Federal 
Government for the sound effectuation of 
such policies, (b) policies vdth respect to in- 
ternational radio and wire communications, 
(c) the relationship of Government com- 
munications to non-government communica- 
tions, and (d) such related policy matters as 
the Board may determine. 

I feel that the problem of radio frequencies 
will be one of the most important areas for 
the Board's investigations. I hope that, as 
a result of its studies, the Board will be able 
to recommend possible means for conserving 
frequencies, as well as standards for deter- 
mining the relative priority of competing 
claims for frequencies, and possible adminis- 
trative arrangements within the Government 
for assuring, on a continuing basis, a sound 
and equitable allocation of the limited fre- 
quency supply. 

I believe that the studies to be undertaken 
by the Board are of vital importance to the 
economy of this Nation, to our international 
relations, and to our national security. I am 
sure that you will receive the full coopera- 
tion and assistance of all parties concerned. 
Sincerely yours, 

Harry S. Truman 

[Dr. Irvin L. Stewart, President, University of West 
Virginia, Morgantown, West Virginia.] 

note: The President's Communications Policy Board 
was established by Executive Order loiio (3 CFR, 
1949-1953 Comp., p. 302). 

The following persons were appointed by the 
President to the Board, in addition to Dr. Stewart: 
Dr. Lee A. DuBridge, president, California Institute 
of Technology, Pasadena, Calif.; David H. O'Brien, 



170 



Harry S. Truman, igp 



Feb. 



22 



[42] 



Hackettstown, N.J.; William L. Everitt, dean, Col- 
lege of Engineering, University of Illinois, Urbana, 
111.; and Dr. Janies R. Killian, Jr., president, Massa- 
chusetts Institute of Technology, Cambridge, Mass. 



On February 16, 1951, the Board submitted to the 
President its report, "Telecommunications, A Pro- 
gram for Progress" (238 pp., Government Printing 
Office, Mar. 1951). 



41 Remarks at a Masonic Breakfast on Washington's Birthday. 
February 22, 1950 



Mr. Chairman and distinguished guests: 

I am exceedingly happy to be with you this 
morning for breakfast, but I don't think it 
would be entirely fair for me to take ad- 
vantage of the opportunity to inflict two 
speeches on you, because at 2:30 this after- 
noon I am going to address you formally 
and straight from the shoulder on the for- 
eign policy of the United States as it affects 
the birthday of George Washington. 

I think that gatherings of this kind are 
exceedingly helpful for the welfare of the 
country as a whole. We come from every 
corner of the United States, we know the 
local conditions, and we have come here to 
discuss national affairs and to discuss our 
own problems; and we go back home bigger 
and broader men, and in that way can con- 
tinue the traditions on which our Govern- 
ment is founded. 

It is a pleasure to me this morning to see 
a great many gendemcn here who are not 
members of the fraternity. They are just as 
good citizens and just as good men, never- 
theless. I am very sure that there are some 
of them here this morning that I am going 
to have to get absolution for. I am a very 



good friend of His Holiness the Pope, so you 
needn't worry. 

I do appreciate this privilege. I hope that 
it can be continued, and that we can get to- 
gether for pleasure and fraternal association 
year after year, for the welfare not only of 
this organization to which we belong, but 
for the welfare of the United States and the 
governments of the world as a whole who 
believe in the Bill of Rights for their citizens. 
That is the thing that we are fighting for in 
this world. 

If I am not careful, I will probably be 
tipping you off as to what I expect to discuss 
this afternoon, so I think now is a good time 
to quit. 

Thank you very much. 

note: The President spoke at 8:15 a.m. in the 
Congressional Room of the Statler Hotel in Wash- 
ington. His opening words "Mr. Chairman" re- 
ferred to Frank Land, founder of the Order of 
DeMolay. 

The breakfast was given in the President's honor 
by Mr. Land on behalf of the Grand Masters of the 
Masonic Order who were in Washington to attend 
the Grand Master's Conference. Also in attendance 
at the breakfast were several high officials of the 
Federal Government. 

President Truman was a thirty-third degree Mason 
and a Past Grand Master of the Grand Lodge of the 
State of Missouri. 



42 Address on Foreign Policy at the George Washington 
National Masonic Memorial. February 22, 1950 



IT IS a great privilege to dedicate this in- 
spiring :5tatue of George Washington. 

This is the climax of many years of plan- 
ning and effort. I congratulate particularly 



the Order of DeMolay, whose contributions 
have made this statue a reality. This heroic 
likeness of our first President makes even 
more impressive the entrance hall of this 



171 



[42] Feb. 22 



Public Papers of the Presidents 



temple. It is altogether fitting that this work 
should stand in the community that Wash- 
ington did so much to build, and so near his 
own home at Mount Vernon. 

George Washington, like ourselves, lived 
in a period of great change — a period when 
new forces and new ideas were sweeping 
across the world. He was the leader of his 
people in a revolution against tyranny. He 
commanded an army in a long and bitter 
war. He was a major figure in the creation 
of a new kind of constitution. And, finally, 
as the first President of our Nation, he trans- 
lated that Constitution into a living govern- 
ment. 

Washington's efforts for freedom were 
twofold. He was concerned first with mak- 
ing the ideal of democratic government 
work. He was also concerned with the de- 
fense of that ideal against the forces that 
opposed it. 

Washington was unwavering in his de- 
votion to the democratic concept. He 
never yielded to those who urged him to 
assume extraordinary powers. Even in the 
darkest days of the Revolution, when his 
task as Commander in Chief of the American 
forces was rendered doubly diflScult by the 
weakness of the Congress and the rivalries 
among the states, he always considered him- 
self a servant of the people. In all that he 
did he strove to make democratic institutions 
more eiffective. 

He knew, too, that they had to be de- 
fended — that there were times when the use 
of force to defend democracy could not be 
avoided. He not only led the armies of the 
revolution, but as President he was always 
alert to the necessity of a vigorous national 
defense. 

The task of Americans today is fundamen- 
tally the same as it was in Washington's 
time. We, too, must make democracy work 
and we must defend it against its enemies. 

But our task today is far greater in scope 



than it was in Washington's time. Not only 
are we concerned with increasing the free- 
dom, welfare, and opportunity of our people. 
We are also concerned with the right of other 
peoples to choose their form of government, 
to improve their standards of living, and to 
decide what kind of life they want to live. 

Since Washington's time the great prin- 
ciples for which the American Revolution 
was fought have become known throughout 
the world and have uplifted the hearts and 
hopes of generations of men. At the same 
time, through the progress of science, the 
nations of the world have been drawn to- 
gether into a common destiny. Our security 
and progress are today more closely related 
than ever before to the advance of freedom 
and self-government in other lands. 

This is a time of restlessness and change. 
In many parts of the world men are search- 
ing for a better social order. They demand a 
way of life that will provide greater freedom 
and more widespread opportunity. They 
yearn to own the land they live on, and to be 
secure against poverty, disease and hunger. 
Above all, they want to live their own lives 
as they see fit. This rising demand of men 
everywhere for independence and a better 
life puts the ideals of freedom and self- 
government to their greatest test. 

At the same time, these ideals are under 
deadly attack from those who would destroy 
them. The most aggressive of these enemies 
today is communism. Communism seeks to 
induce men to surrender their freedom by 
false promises of a better Ufe. But the great 
danger of communism does not lie in its false 
promises. It lies in the fact that it is an 
instrument of an armed imperialism which 
seeks to extend its influence by force. 

This threat of force is a challenge to all 
peoples who are free and who wish to be 
free and remain free. The fundamental is- 
sue is whether men are to be free to choose 
their own way of life, or whether they must 



172 



Harry S. Truman, igp 



Feb. 22 [42] 



live under a system imposed upon them by 
force. 

Just as our Thirteen Original States found 
that survival and progress depended on closer 
association and common effort, so the free 
nations of the vv^orld today must seek their 
salvation in unity and concerted action. The 
real strength of the free nations is not to be 
found in any single country or in any one 
v^eapon, but in the combined moral and 
material strength of the free world as a 
w^hole. 

As members of the United Nations, the 
free nations are working for peace and inter- 
national security in accordance with the 
principles set forth in the United Nations 
Charter. Within the context of that larger 
association, many of the free nations have 
joined together to strengthen the common 
defense of particular areas against aggression. 
That is the meaning of the North Atlantic 
Treaty and the Mutual Defense Assistance 
Program. 

We shall continue to work with the other 
free nations associated with us in the com- 
mon defense — for our defense is theirs, and 
their defense is ours. The united defense 
of these nations is a powerful deterrent to 
aggression, and it will become more power- 
ful as time passes on. 

In creating a common defense, we do not 
seek to impose a way of life on any nation. 
Freedom is not expanded by conquest. 
Democracy is not created by dictation. 
Freedom and democracy grow only by per- 
suasion and example and through the actual 
experience of what they mean. 

At the same time, freedom cannot grow 
and expand unless it is protected against the 
armed imperialism of those who would de- 
stroy it. The free nations, therefore, must 
maintain military force as a defensive 
measure. 

While the free nations stand prepared to 
resist aggression, they are doing their utmost 



to find peaceful means for settling inter- 
national disputes. They know that another 
great war could destroy victor and van- 
quished alike. 

Consequendy, we in the United States are 
doing, and will continue to do, all that lies 
within our power to prevent the horror of 
another war. We are working for the re- 
duction of armaments and the control of 
weapons of mass destruction. 

We are convinced of the necessity for 
an international agreement to limit the use 
of atomic energy to peaceful purposes, and 
for a working international system to as- 
sure that such an agreement is effectively 
carried out. We believe that the United Na- 
tions is the proper forum to reach such an 
agreement. We firmly believe that all na- 
tions would gain by such an international 
agreement. We shall continue to work hon- 
esdy and wholeheartedly toward that end. 
But we must remember that the outcome is 
not ours alone to determine. The actions of 
men in other countries will help to shape 
the ultimate decision. 

We believe that the plan for controlling 
atomic energy which has been worked out 
in the United Nations and has been ap- 
proved by the overwhelming majority of its 
members, would be effective. The plan, 
therefore, has our support. It has our sup- 
port not because of its form or its words, but 
because we believe that it would achieve 
effective control. The stakes are too large 
to let us, or any nation, stand on pride of 
authorship. We ask only for a plan that 
provides an effective, workable system — 
anything else would be a sham agreement. 
Anything less would increase, not decrease, 
the dangers of the use of atomic energy for 
destructive purposes. We shall continue to 
examine every avenue, every possibility of 
reaching real agreement for effective con- 
trol. 

In the long run, however, our security 



173 



[42] Feb. 22 



Public Papers of the Presidents 



and the world's hopes for peace lie not in 
measures of defense or in the control of 
weapons, but in the growth and expansion of 
freedom and self-government. As these 
ideals are accepted by more and more 
people, as they give greater meaning and 
richer content to the lives of millions, they 
become the greatest force in the world for 
peace. 

The purpose of our participation in the 
United Nations and other international or- 
ganizations is to strengthen this great force 
for peace. That is the purpose of the Euro- 
pean recovery program and our point 4 pro- 
gram to assist underdeveloped areas. That 
is the purpose of our foreign trade pro- 
gram and our other measures to help build 
world prosperity. 

These programs are positive measures to 
increase the strength of freedom and self- 
government by helping men to meet the 
needs and fulfill the aspirations of their daily 
lives. 

Today, in many countries of the world, 
the concepts of freedom and self-govern- 
ment are merely vague phrases. They ex- 
press little to people who are engaged in a 
desperate struggle with ignorance and pov- 
erty. They mean little to men who must 
work from sunup to sundown merely to keep 
alive. They are not fully understood by 
men who cannot read or write. 

On the continent of Asia, the islands of 
the Far East, in Africa, in the Near East, 
are millions of people who live in poverty 
who have never known real freedom or dem- 
ocratic government. In their present con- 
dition, the immediate benefit of steel plow- 
shares, or smallpox vaccinations, has more 
appeal than abstract ideas of democracy. 

The Communists are saying that they 
will bring food and clothing and health and 
a more secure life to these poverty-stricken 
peoples. We know that is not true. But it 
is not enough to tell such people that com- 



munism is a modern tyranny far Worse than 
that of any ancient empire. It is not enough 
to tell them that communism leads only to 
oppression. People who have never known 
freedom and security themselves have litde 
basis for judging how false are the claims 
of communism. 

These people will turn to democracy only 
if it seems to them to be the best way to 
meet their urgent needs. The benefits of 
freedom and democracy must be demon- 
strated to them. 

In many of these areas there are govern- 
ments which are working to improve the 
conditions of their people. They know that 
the claims of the Communists are not made 
in good faith. They do not want Soviet 
domination. If these governments are suc- 
cessful in raising living standards, and in 
building strong and stable democratic insti- 
tutions based on popular support, their peo- 
ple will not go over to communism. 

But these governments are struggling with 
titanic problems, as their people attempt to 
climb in a few years from economic misery 
to better standards of living. They need 
help. If these nations are to grow in free- 
dom, they urgently need assistance in im- 
proving their health, their education, and 
their productive capacity, their transporta- 
tion and their communication systems. 

That is why I have requested the Con- 
gress to act as rapidly as possible on legisla- 
tion to expand our programs for giving tech- 
nical assistance to such countries as these, 
and to encourage American investment in 
those countries on a mutually beneficial basis. 
We are not trying to sell them automobiles 
and television sets. Our purpose is to help 
them grow more food, to obtain better edu- 
cation, to be more healthy. That is the way 
they can gain the physical and moral strength 
to be free and to maintain their own govern- 
ments. 

As these nations prove to themselves and 



174 



Harry S. Truman, ig^o 



Feb. 22 [42] 



to others the effectiveness of free institutions 
in meeting their people's needs, they will 
show as nothing else can the true value of 
democracy and the false claims of commu- 
nism. 

But the problem of making free institu- 
tions work is not confined to underdeveloped 
areas. The highly developed nations of 
Europe came out of the war with serious 
problems of their own. They were threat- 
ened with economic chaos. Their ability to 
maintain freedom and democracy was chal- 
lenged. 

The purpose of the European recovery 
program was to meet this challenge in the 
area of the world where the preservation of 
free governments was of supreme impor- 
tance. The results which have been 
achieved so far under that program have 
amply demonstrated its wisdom. 

With the aid we have provided, the na- 
tions of Europe have already made great 
advances in their production and have im- 
proved their trading relations with the rest 
of the world. Much more must be done 
before they reach the firm basis of economic 
self-support which is essential to the main- 
tenance of free and democratic governments. 
Consequently, we must complete our pro- 
gram of assistance. It would be utter folly 
to lose sight of the importance of the Euro- 
pean recovery program. It is essential to our 
hopes for peace. 

The preservation and strengthening of 
free governments depends in large measure 
on the creation of firm economic conditions 
throughout the world and on an expanding 
world trade. Free nations can expand their 
trade only on the basis of mutual respect and 
fair dealing. 

Our reciprocal trade agreements program 
and the International Trade Organization 



are the kind of international machinery 
which is necessary for increasing the trade 
of the world. We shall continue to use the 
procedures of the reciprocal trade agreements 
program to reduce trade barriers, but more 
than this is needed. That is why I have 
urged the Congress to act favorably on the 
creation of the International Trade Organi- 
zation, through which the nations of the 
world can work together effectively to in- 
crease world trade. 

This program and our other plans for 
international action are the practical way to 
move forward toward peace. They recog- 
nize that we must deal with the difficult 
world situation which actually exists. We 
must not be discouraged by difficulties and 
setbacks. We must not be misled by the 
vain hope of finding quick and easy solu- 
tions. We must move forward persistendy 
and courageously along the hard path to 
peace, based on freedom and justice. 

The progress we have made in this coun- 
try since the days of George Washington is 
proof of the vitality and truth of the ideals 
he fought for. We must be no less firm, no 
less resolute, no less steadfast than he was. 
We move upon a greater stage than he did, 
but our problems are fundamentally the 
same problems that faced the first President 
of this Nation — to make democracy work 
and to defend it from its enemies. 

George Washington sought guidance from 
Almighty God as he faced these tasks in his 
time; let us be guided today by divine provi- 
dence as we strive for lasting peace with 
freedom and justice for all mankind. 

note: The President spoke at 3 p.m. at the George 
Washington National Masonic Memorial in Alexan- 
dria, Va. 

The statue o£ George Washington was the work of 
Bryant Baker of New York City. 



175 



[43] Feb. 22 



Public Papers of the Presidents 



43 Telegram to Labor and Management Leaders in the 
Communications Industry Urging a 6o-Day Truce. 
February 22, 1950 



CYRUS S. CHING, Director of the Federal 
Mediation and Conciliation Service, has re- 
ported to me the status of the disputes be- 
tween communications workers of America, 
CIO, and important units of the Bell System 
which operate our nationwide network of 
telephone communications. Mr. Ching in- 
forms me that insufficient progress has been 
made to date in the negotiations between 
the parties to give reasonable promise of 
settlement of these disputes prior to Febru- 
ary 24, or to give assurance of uninter- 
rupted telephone service after that date. I 
need hardly describe or emphasize the great 
damage to the public interest and welfare 
which would result if these disputes are not 
settled by agreement. 

I feel very strongly that employers en- 
gaged in the operation of public utilities and 
unions representing their workers have a 
special and extraordinary responsibility to 
settle their differences by agreement and 
without resort to economic action which may 
deprive the public of the benefits of essential 
services. The discharge of this obligation 
requires that in good faith, such employers 
and unions canvass and weigh most thor- 
oughly all demands and counter-offers which 
are made in their bargaining sessions and 
that they consider exhaustively all possi- 
bilities for a peaceful resolution of the issues 
in dispute. 

In many of the negotiations in progress in 
the current telephone disputes there has 
clearly been insuflScient time for adequate 



and full consideration of their respective 
positions. The parties have a duty to con- 
tinue their efforts to work out a peaceful 
solution through the bargaining process. 
The special obligation and duty which ap- 
plies to public utilities and the unions with 
which they deal cannot be satisfactorily dis- 
charged by them in the face of the impend- 
ing February 24 deadline. 

Accordingly, I am requesting the parties 
to continue work and operations, without 
any interruption of telephone communica- 
tions in the Nation, under the wages, terms 
and conditions now in effect, for a period of 
60 days from February 24, 1950. During 
that period, with the active assistance of the 
Federal Mediation and Conciliation Service, 
they should earnesdy seek to resolve the cur- 
rent disputes through collective bargaining. 
Compliance with this request by the parties 
will demonstrate a proper regard for the 
public interest and welfare. 

I would appreciate your advising me of 
your acceptance. 

Harry S. Truman 

note: This is the text of identical telegrams sent 
to 44 management and labor leaders in the com- 
munications industry. Some 40 replies, agreeing 
to the President's request for a truce, are on file in 
the Harry S. Truman Library in Independence, Mo. 
Labor unrest continued throughout most of 1950 
and did not fully terminate until November 19, 1950. 
On that date the Communications Workers of Amer- 
ica signed a 15-month pact with the Western Elec- 
tric Co. and the Michigan Bell Telephone Co., afl&li- 
ates of the American Telephone and Telegraph Co. 



176 



Harry S. Truman, ig^o 



Feb. 23 [44] 



44 The President's News Conference of 
February 23, 1950 



THE PRESIDENT. I havc no Special announce- 
ments to make. I will try to answer ques- 
tions. 

[i.] Q. Mr. President, is the FEPC bill 
which the House passed today satisfactory 
to you? ^ 

THE PRESIDENT. I haven't seen the bill. I 
haven't read it, but my position on FEPC 
has been made perfectly plain in various 
messages I sent the Congress. 

Q. Mr. President, this is a slightly philo- 
sophical question, because it has come up 
several times in the debate up there. Do you 
think it is possible to prohibit or legislate 
against racial discrimination, against people 
of equal aptitude in job opportunity, and 
still permit a man to operate his business 
with the right to fire and hire whom he 
pleases? 

THE PRESIDENT. I have always thought so. 

Q. Mr. President, we couldn't hear. 

THE PRESIDENT. I Said I have always 
thought so. 

[2.] Q. Mr. President, Representative 
Durham, who is the Vice Chairman of the 
Joint House and Senate Atomic Energy 
Committee, says that he thinks the current 
agitation for a new approach to Russia on 
atomic control might be dangerous. I just 
wondered if you had any thoughts on that 
subject? 

THE PRESIDENT. Well, I dou't know what 
result he hopes to obtain. We have made 



* On February 23 the House of Representatives 
passed a bill (H.R. 4453) to establish a Fair Em- 
ployment Practice Commission and to aid in elimi- 
nating discrimination in employment because of race, 
color, or creed. The Senate failed to complete action 
on a similar bill (S. 1728) when moves to invoke 
the cloture rule were defeated on May 19 and July 12, 
1950. 



every approach possible through the regular 
channels, and through the United Nations, 
in an endeavor to reach such an agreement. 
And we haven't been able to reach it. I 
don't see any reason for what they call a new 
approach. They are expecting something 
highly dramatic, some great showpiece to 
take place. I don't think the matter can be 
setded in that manner, and I have never 
thought so. 

Q. I don't know whether I have got his 
position wrong, but he says that the current 
agitation for such a move might be danger- 
ous. 

THE PRESIDENT. Well, I don't kuow about 
that. I don't know what he is thinking 
about. 

Q. Didn't you say virtually that in your 
Alexandria speech yesterday, Mr. President? 

THE PRESIDENT. Yes, I thought I made it 
very clear. I tried to put it in the simplest 
English possible in that Alexandria speech, 
and I think it covers the situation very well.^ 

Q. Has there been any sign of any new 
feeler from Russia, Mr. President? 

THE PRESIDENT. No, there has not. 

[3.] Q. Mr. President, do you plan to 
send another representative to the Vatican? 

THE PRESIDENT. The matter has been 
under consideration ever since Mr. Taylor 
resigned, and no decision has been reached 
as yet. 

[4.] Q. Mr. President, Congressman 
Biemiller of Wisconsin quoted you as saying 
that you and he agree that you would like 
to replace Senator Wiley with a Democrat 
this year. I wonder if that is correct? 

THE PRESIDENT. Well, I am exceedingly 
hopeful that a great many Republicans will 

^ Item 42. 



177 



[44] Feb. 23 



Public Papers of the Presidents 



be replaced by Democrats, and of course, if 
Senator Wiley is up for election, that would 
include him. [Laughterl 

[5.] Q. Mr. President, can you see any 
danger in a one-party system? 

THE PRESIDENT. What's that? I don't 
like a one-party system. We haven't two 
parties now; we've got about four. 

[6.] Q. Mr. President, have you de- 
cided — this action of the Senate yesterday, 
for an investigation into alleged subversive 
employees in the State Department; they 
voted to give the power to subpoena confi- 
dential employment and loyalty records. I 
wonder if you have given the departments 
any instructions on that? 

THE PRESIDENT. I think I issued very clear 
instructions on that some time back. It still 
stands. I have told the Committee — ^the 
Foreign Relations Committee — ^that I would 
cooperate with them in every way possible to 
disprove false charges that have been made 
by Mr. McCarthy. 

[7.] Q. Mr. President, what are the four 
parties you had in mind? 

THE PRESIDENT. Well, there's the Dixie- 
crats — half Republican; there's the Republi- 
can Party; and there's what's left of Mr. 
Wallace's party; and there's a real national 
party, the Democratic Party. [Laughter^ 

Q. How about the Socialist? 

THE PRESIDENT. Oh, they don't count. 

Q. They don't count? 

THE PRESIDENT. They have never had an 
electoral vote in the history of the country. 

[8.] Q. Mr. President, are you consider- 
ing any new moves in the coal crisis ? 

THE PRESIDENT. The coal crisis is in the 
hands of the courts right now, and I have 
no comment to make on that question. 

Q. Mr. President, are you getting any re- 
ports of progress from your observers in the 
coal negotiations? 

THE PRESIDENT. I hear from them every 
day. 

178 



Q. Are there any 

THE PRESIDENT. No Comment will be made 
on the matter. It's in the courts now. I told 
you that to begin with. I can't comment on 
it. It's a matter for the courts. 

[9.] Q. Mr. President, in answering that 
question about the McCarthy investigation, 
you said you told the Foreign Relations Com- 
mittee that you would cooperate in any way 
to disprove the false charges. You mean 
by that any way short of delivering these 
records 

THE PRESIDENT. I wiU auswer that question 
when it comes up. You needn't put words 
in my mouth 

Q. I didn't mean that at all. 

THE PRESIDENT. as I told someoue else 

the other day. 

Q. But you are not saying now, sir, that 
you won't give the records 

THE PRESIDENT. I am uot sayiug anything 
further to what I said in my directive to the 
various departments, which is very clear.^ 

Q. That directive still 

THE PRESIDENT. That directive still stands. 

Q. That was the directive, sir, in which 
you said not to turn over the 

THE PRESIDENT. That is correct. 

Q. Mr. President, wasn't there something 
in that, sir, that said to refer all requests to 
you? 

THE PRESIDENT. That is corrcct. 

Q. That part of it still stands? 

THE PRESIDENT. That part of it still stands. 

Q. The subpoena would make no dififer- 
ence? 

THE PRESIDENT. Not the slightest in the 
world. You can't very well — ^I was going to 
say, it's pretty hard to serve a subpoena on 
the President of the United States. 
[Laughter] Who is going to enforce it? 



^For the President's directive of March 15, 1948, 
on the need for maintaining the confidential status 
of employee loyalty records, see 1948 volume, this 
series, Item 50. 



Harry S. Truman, ig^o 



Feb. 23 [44] 



[10.] Q. Mr. President, if it is contem- 
plated going to Grand Coulee this spring, 
are you going to make any speeches on the 
way out and on the way back? 

THE PRESIDENT. Well, I have been invited 
to dedicate the Grand Coulee Dam, which 
is now finished — I think it has all the genera- 
tors in, and in place. And there has been 
some discussion about my making a trip out 
there. No decision has been made on it, 
but I think your guess is right, that if we 
do go there will be some stops along the 
road. 

Q. That was the nonpolitical trip you were 
referring to last week? 

THE PRESIDENT. That is corrcct. Probably 
be some whistlestops on the way there and 
on the way back. 

Q. Will that be April when 

THE PRESIDENT. No dccision has been made 
on that yet. I have been invited. Like every 
other invitation that I get — and I get many 
every day to go somewhere^ — I have taken it 
under consideration. 

Q. Mr. President, how do we tell what is 
political and what is nonpolitical? [Laugh- 
ter] 

THE PRESIDENT. You wiU havc to make up 
your own mind on that. That is for you to 
decide. [Laughter] 

Q. We didn't hear that. 

THE PRESIDENT. I told her that is for her 
to make up her own mind on that. That 
is for her to decide, whether it is nonpolitical 
or not. 

Q. You can make a political speech or a 
nonpolitical speech. 

THE PRESIDENT. Oh ycs, it Can be done very 
nicely. Any speech I make or any statement 
I make is political. It doesn't make any 
difference whether it is made here or whether 
it is made in Alexandria, Va., or in New 
York, or on the back platform of a train. 

Q. What about when you discuss the is- 
sues, Mr. President? 



THE PRESIDENT. That is political, too. 
[Laughter] That is political, too. 

Q. Well, when is it not political? 

THE PRESIDENT. Well, here is the situation 
you have got to take under consideration. 
The speech that I made in Alexandria was on 
the bipartisan foreign policy. That is not 
supposed to be a matter for local political 
discussion. That is to be treated as if it was 
a speech like the one I made once before, 
which was purely a domestic political state- 
ment of my views and how they ought to be 
carried out. I was speaking in Alexandria 
for the whole country, and not for any politi- 
cal party. 

Q. How would you define political, Mr. 
President? 

THE PRESIDENT. Well, there are lots of 
definitions for it. 

Q. What is yours? 

THE PRESIDENT. I think I have told you 
that a politician is a man who understands 
government. Usually, if he understands it 
well enough and has made a reputation, as 
he should have, he will wind up — ^when he 
is dead — ^by being called a statesman. You 
have to have your own definition of what to 
call things political. It depends altogether 
on what your viewpoint is. If you are for it, 
it is statesmanlike. If you are against it, it 
is purely low politics! [Laughter] 

[11.] Q. Mr. President, how would you 
define the speech of Senator Byrd, who 
called you a stumbling block to balancing 
the budget? 

THE PRESIDENT. That is purely political. 
[Laughter] 

Q. He was a statesman. 

Q. What was that question, sir, we didn't 
get that question? 

THE PRESIDENT. He Wanted to know how 
I would define Senator Byrd's statement in 
yesterday's Baltimore Sun — ^the Sun is a great 
supporter of Byrd — and I said it was purely 
political. 



179 



[44] Feb. 23 



Public Papers of the Presidents 



[12.] Q. Mr. President, would you de- 
fine that half -Republican Party some more? 

THE PRESIDENT. The half- Republican 
Party? Well, the Republican Party is split 
in two. It has two wings, just like the Demo- 
cratic Party does. 

[i3«] Q' Mr. President, have you any in- 
tention of listening in on the radio this eve- 
ning to the results of the British elections? 

THE PRESIDENT. I don*t think it is possible 
to get the returns immediately. The last 
time the British had an election, it was 3 
days before they decided to count the vote. 
And I think we will have to wait until the 
report is made by the people who count the 
votes. They don't count their votes like 
we do. They impound them and then after 
they have been collected they count the votes 
at a later time, after the election. 

[14.] Q. Mr. President, do you feel that 
the Voice of America is handicapped by the 
difficulty of getting news up on the Hill? 

THE PRESIDENT. Yes I do, and I think it is 
also handicapped by a lack of appropriations, 
principally. 

[15.] Q. Mr. President, when you spoke 
about the difficulty of serving a subpoena on 
you, did you mean you were protected by 
the courts or the Secret Service? 



THE PRESIDENT. I am protected by the Gov- 
ernment of the United States. You ought 
to know that it has been tried. You re- 
member a certain statement by a gendeman 
named Jackson? "The Chief Justice of the 
Supreme Court has made his decision, now 
let us see him enforce it." You remember 
that, don't you? 

Q. Oh yes. 

[16.] Q. Mr. President, going back to 
coal, Mr. Case put in a bill today to declare 
a national emergency.* 

THE PRESIDENT. What's that? 

Q. Mr. Case put in a bill in the House to- 
day to declare a national emergency in the 
coal situation, and asks the coal miners back 
and asks the Government to call out the 
National Guard to make them go back. Do 
you think that will do any good? 

THE PRESIDENT. I have no comment on 
that. 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You're welcome. 

note: President Truman's two hundred and 
eighteenth news conference was held in his office 
at the White House at 4 p.m. on Thursday, Febru- 
ary 23, 1950. 

* The bill was referred to the Committee on Edu- 
cation and Labor. It was not reported out by that 
Committee. 



45 Radio Remarks Opening the Red Cross Campaign. 
February 28, 1950 

[ Broadcast from the White House at 10:54 P-"^* ] 



General Marshall, my fellow Americans: 

Tonight many of you have heard from 
the lips of individuals what the Red Cross 
has meant to them and to their loved ones. 
These examples represent a few authentic 
reports from this great organization's files. 
They tell the story of the Red Cross more 
vividly than any statistics I could quote. 
These testimonials from the people translate 
figures and costs into good deeds. They give 



new meaning to the balance sheet. 

After all, the Red Cross interests itself al- 
most solely in meeting human needs — 
whether the demands are in the field of dis- 
aster relief; in safeguarding health; in safe- 
ty work; in providing lifesaving blood and its 
derivatives without charge; or in its invalu- 
able services to our armed forces and to our 
veterans. Here is an agency that has be- 
come almost indispensable in our community 



180 



Harry S. Truman, ig^o 



Mar. 2 [46] 



life today. It is a neighborly service. At the 
same time, its help is available to distressed 
people around the world. 

There could be no finer testimonial to the 
Red Cross than the devotion it inspires in its 
volvmteers — ^men and women whose sole 
reward is the deep satisfaction of service to 
others. 

Tonight, 2,000,000 of these messengers of 
goodwill stand ready to visit your homes or 
your places of business tomorrow and 
throughout the month of March — in every 
city, town, and hamlet of our land. These 
are the campaign solicitors of the American 
Red Cross. Let us remember that all the 
workers in this voluntary army are giving 
not only of their funds, but of their time and 
energy as well. These public-spirited men 
and women are entided to a hearing when 
they call on you. 

Through your response to their appeal the 
Red Cross becomes your agent to do for your 



less fortunate neighbors the things you would 
do yourself if you could be at the scene when 
the calamity strikes, or when the accident 
occurs, or when a man in uniform or an 
ex-serviceman needs a helping hand. 

In all that it does, the Red Cross is flexible 
enough to provide aid which is entirely per- 
sonal, yet strong enough to deal with major 
disasters involving hundreds of thousands 
of individuals. 

The Red Cross belongs to the American 
people. It is your organization. As Presi- 
dent of the United States, I enrolled in the 
Red Cross earlier today. I consider this 
annual enrollment a genuine privilege. In 
these fateful days, I ask all Americans to join 
in responding to a great humanitarian 
appeal. 

note: In his opening words the President referred to 
General of the Army George C. Marshall, President 
and Chairman of the Board of Governors of the 
American National Red Cross. 



46 The President's News Conference of 
March 2, 1950 



THE PRESIDENT, [i.] I have uo Special 
announcements to make, but I have been 
trying to work out a situation that would 
make it more convenient at these press 
conferences. I have discussed the matter 
with Mr. Ross, and I will appreciate it if the 
White House correspondents will appoint a 
committee to confer with Mr. Ross. 

I would like to find a place to hold these 
press conferences where the acoustics are 
good and where everybody would have a 
fair chance to hear the questions and to 
recognize the one who asks the question, 
and also to hear the answer plainly. This 
situation here is not satisfactory, especially 
to those who happen always to get in the 
rear ranks. 

And if you will please confer with Mr. 



Ross, we will see if we can't make some plan 
where everybody will have a better chance 
at these press conferences. 

Q. Bravo. 

Q. Thank you, sir. 

Q. Mr. President, if you have no an- 
nouncements, do you agree with Senator 
Humphrey and Senator Lucas that the Byrd 
Nonessential Expenditures Committee ^ 
should be abolished? 

THE PREsmENT. I havcn't gone into that 
controversy, so I can't answer intelligendy, 

[2.] Q. Mr. President, can you tell us 
about the Niagara treaty that was signed 
Monday by Canada and the United States, 



^ Joint Committee on Reduction of Nonessential 
Federal Expenditures, of which Senator Harry F. 
Byrd of Virginia served as chairman. 



181 



[46] Mar. 2 



Public Papers of the Presidents 



dealing with the diversion of water to falls 
and the creation of power there? 

THE PRESIDENT. That has been under con- 
sideration for some time, and we have finally 
reached an agreement on it. And it has 
been — I think it has been sent to the Senate 
for ratification.^ 

Q. It has been? 

THE PRESIDENT. It wiU be, if it hasn't. 

Q. No delay on that, so far as you know? 

THE PRESIDENT. Not that I kuOW of. 

Q. What do you think about the possi- 
bility of Federal development of that power 
up there? 

THE PRESIDENT. Well now, you had better 
ask the Congress about that. I have been 
fighting for that for 15 years. If the Con- 
gress will perform, why, we will do the job. 

Q. Is there a question between private de- 
velopment and Federal development? 

THE PRESIDENT. Not SO far as I am con- 
cerned. It is public development so far as 
I am concerned. 

[3.] Q. Mr, President, you are having 
lunch today, I believe, with Dr. Li, who has 
been acting President of China? 

THE PRESIDENT. That's right. And he is — 
still says he is. 

Q. In what capacity is he coming in? 

THE PRESIDENT. He IS comiug in as the 
acting President of China. That is the 
reason he was invited for luncheon. 

Q. What happened to Chiang Kai-shek? 

THE PRESIDENT, I am not in communica- 
tion with Chiang, I can't tell you. 
{Laughterl 

Q. He says he is going to come back on 
the mainland — I am not trying to get you on 
the spot over it, but anything interesting 
along that line would be— I think it would 
be 

THE PRESIDENT. I have nothing to say on 
the subject. 

[4.] Q. Mr. President, there is a story 

^ See Item 99. 



going around that after Judge Keech ^ gets 
through with this coal case, that the Gov- 
ernment is preparing to move in with seizure 
powers, and there will be a request from the 
Government. Is there anything on that you 
can tell us about? 

THE PRESIDENT. No, I cau't Say anything 
about that because that matter is still pend- 
ing in the courts, and I don't want to make 
any announcements or suggest any action 
until the court has had a chance to decide.* 

Q. Mr. President, there is another report 
that the order for seizure has been drawn 
up — ^technical draft? 

THE PRESIDENT. There has always been a 
technical draft of all the war powers on hand, 
in case it is necessary to use them. Nothing 
new. 

[5.] Q. Mr. President, I understand the 
Security Council does not think much of 
these ideas that are going around, preparing 
to move the Capital. Is there anything you 
could tell us about that? 

THE PRESIDENT. No, I have no comment 
on that. 

Q. What do you think of it? 

THE PRESIDENT. I am Very well satisfied 
right where I am now, and I feel perfecdy 
safe. [Laughterl 

[6.] Q. Mr. President, are you consider- 
ing the State Department proposal to form 
an interdepartmental committee to unify 
domestic and foreign economic policies? 

THE PRESIDENT. Ask that qucstiou again. 
I didn't get it. 

Q. There is a report that the State Depart- 
ment proposes to form an interdepartmental 
committee to consider unifying domestic and 
foreign economic policies? 

THE PRESIDENT. That may be under con- 
sideration. It has not been put up to me. 

[7,] Q. Mr. President, James F. Byrnes 



"Judge Richmond B. Keech of the U.S. District 
Court for the District of Columbia. 
* See Items 49, 50. 



182 



Harry S. Truman, ig^o 



Mar. 2 [46] 



proposed today that we abolish the withhold- 
ing tax, on the theory that tax paying is more 
painful and there might be emphasis on 
economy. I wonder if that would really 
help? 

THE PRESIDENT. I don't know. You will 
have to talk to Mr. Byrnes on that. He has 
had a lot of experience. [Laughter] 

[8.] Q. Mr. President, I had in mind the 
fact that President Gonzalez of Chile is to 
come up here, I believe in April. Have you 
yet formulated or approved an itinerary, or 
do you have any general comment about 
the visit? 

THE PRESIDENT. No, hc will be treated as 
all these heads of states are. Whatever he 
chooses to see and examine. We will fur- 
nish him with all the hospitality this coun- 
try can furnish — ^as we always furnish it. 

Q. You are looking forward to his visit? 

THE PRESIDENT. Oh ycs, he has already ac- 
cepted the invitation. 

Q. I don't know when it would be. 

THE PRESIDENT. April 1 2th, I think, is the 
date. 

[9.] Q. Mr. President, you have men- 
tioned seizure of the coal mines. Do you 
Still have any of your war powers 

THE PRESIDENT. No. 

Q. All expired? 

THE PRESIDENT. All expired. 

Q. Mr. President, would that apply also to 
your inherent powers? 

THE PRESIDENT. No — ^finc line to be 
drawn — ^we will cross that bridge when we 
come to it. 

Q. Mr. President, Henry Ford says the 
situation is so serious that the country will 
be closed down — he makes it very sweeping, 
2 weeks — ^if these coal strikes continue. Do 
you think that the situation is that serious? 

THE PRESIDENT. I Can't auswer that ques- 
tion. I don't know whether it is or not. I 
know the situation is very serious. It is an 
emergency. And that is what the law 



provides, that in case of an emergency 
we have to consider certain procedures. We 
have been following the law to the letter 
trying to enforce it. 

Q. Mr. President, is this the first time that 
you have said to us that it is an emergency? 

THE PRESIDENT. No, it is uot. I aunounccd 
an emergency when I appointed the board. 
It requires the announcement of an emer- 
gency, and that board has to find an emer- 
gency before the court can act. 

[10.] Q. Mr. President, there has been 
quite a lot of criticism lately that the econ- 
omies in the Defense Department have 
weakened our defenses dangerously. Could 
you comment on that? 

THE PRESIDENT. I don't think that is true. 
I don't think there is a word of truth in it. 
You can speculate on anything you like, but 
I think you will find that the national defense 
situation is in better shape than it has ever 
been in times when we were not at war. 

[11.] Q. Mr. President, there have been 
some reports recently that you plan to turn 
over the loyalty reports to the committee 
making that investigation. Can you tell us 
something about that? 

THE PRESIDENT. I think I made the state- 
ment here the other day that I was perfectly 
willing to cooperate with the committee in 
furnishing them with information. We will 
cross the loyalty file business when we get 
to it. 

But just for your information, if people 
really were in earnest and had the welfare of 
the country at heart, and they really thought 
that somebody in the Government was not 
loyal or did not do his job right, the proper 
person with whom to take that up is the 
President of the United States. 

And the President of the United States is 
the only one who has taken any concrete 
action on any of these things. The appoint- 
ment of this loyalty board, and the screen- 
ing of employees when the word got around 



183 



[46] Mar. 2 



Public Papers of the Presidents 



that there might be some disloyal ones among 
the employees in the Government, was done 
by the President. 

The prosecution of the Communists in 
this country for disloyalty and sabotage has 
been carried on at the direction of the Presi- 
dent. I don't think anybody else has made 
any concrete endeavor to get to the bottom 
of this thing except the President of the 
United States and the executive branch of 
the Government. 

[12.] Q. Mr. President, the civil rights 
conference here — to v^hich you sent a note of 
greeting — ^wound up by adopting a resolu- 
tion asking you to appoint a commission to 
make a thorough study of the establishment 
of civil rights, particularly as affecting — civil 
liberties — ^particularly as affecting the loyalty 
program. Do you plan 

THE PRESIDENT. As afifectcd by what ? 

Q. By the loyalty program. 

THE PRESIDENT. I think that the loyalty 
program was worked out with civil liberties 
in view. And I think if you will follow the 
procedure that was followed by the loyalty 
investigations, you will find that nobody's 
civil liberties have been infringed, and no- 
body's civil liberties will be infringed. I 
think I made that perfectly clear when I was 
talking to the district attorneys and the law 
enforcement officers who were here the other 
day. If you will read the speech,^ I think 
you will get the fundamental basis on which 
I am trying to uphold the Bill of Rights. 
That is one of the most important — I think 
the most important part of the Constitution 
of the United States. 

[13.] Q. Mr. President, yesterday Sen- 
ator Harry F. Byrd suggested that he would 
turn over his salary in order to balance the 
budget. Have you any comment on that? 

THE PRESIDENT. That is a very liberal 
gesture on the part of the Senator. [Laugh- 
ter] 
''Item 37. 



Pete^ has been trying to ask a ques- 
tion. 

[14.] Q. Do you think Senator Mc- 
Mahon's proposals on the conference are 
feasible? ^ 

THE PRESIDENT. I havc no commeut on 
that, Pete. 

What was your question? 

Q. That was part of mine. I wondered if 
you are going to Moscow soon to 

THE PRESIDENT. I think I made it per- 
fectly plain that I am not going to Moscow 
ever. The door is open here for anybody 
that wants to come to this country, but I 
am not going to Moscow. 

Q. That is a perfectly plain answer, but 
may I make an amendment in addition to 
Pete's question? McMahon is apparently 
trying to do something along the line that 
you have suggested through the United Na- 
tions 

THE PRESIDENT. That is correct. 

Q. and if he does such a thing, would 

you object to it? 

THE PRESIDENT. Why Certainly not — cer- 
tainly not. I will object to nothing that will 
contribute to the peace of the world. I will 
cooperate wholeheartedly with anything 
that will contribute to the peace of the 
world. I think I have made that per- 
fecdy plain all the time. 

Q. Yes. 

[15.] Q. Mr. President, would you ac- 
cept an invitation from the President of 
Chile to come down there? 

THE PRESIDENT. Well, I would like to, 
very much, but I can't accept right now, 
definitely. 

Q. I believe there is to be a power proj- 
ect that has been built by American money 
dedicated down there in the spring? 

•Raymond P. Brandt of the St. Louis Post-Dis- 
patch. 

'Senator Brien McMahon of Connecticut had 
proposed that the United Nations General Assembly 
hold a meeting in Moscow. 



184 



Harry S. Truman, ig^o 



Mar. 2 [47] 



THE PRESIDENT. So I Understand. 

Q. That would be the occasion that they 
would want you to come? 

THE PRESIDENT. I Can't make any commit- 
ments for any trips away from Washington 
at the present time. 

[16.] Q. Mr. President, have you de- 
cided on a trip in May over to Chicago and 
the Midwest? 

THE PRESIDENT. That is Under contempla- 
tion, but when the decision is made, why 
it will be announced in plenty of time so 
that you can get your grip packed. 
[Laughter'] 

[17.] Q. How did you interpret the 
British elections? 

THE PRESIDENT. I didn't interpret it — 
[laughter] — plenty of people that will do 
that for me. 

[18.] Q. Mr. President, the real estate 
lobby seems to have launched a new cam- 
paign to end rent control by June 30th. Do 
you have anything to say about that? 

THE PRESIDENT. I had my say about that 
in the Message to Congress on the State of 
the Union. I am still behind that message. 



[19.] Q. Mr. President, when you said 
you weren't going to Moscow ever, you 
mean in connection with the present series 
of problems? 

THE PRESIDENT. I mean that I will never 
go to Moscow while I am President of the 
United States. That make it perfectly plain ? 
I hope I will have a chance to go there when 
I get through being President. [Laughter] 
I would like to see the place. 

Q. Any idea when that might be, Mr. 
President? 

THE PRESIDENT. Well — [more laughter] — 
your guess is as good as mine. 

[20.] Q. Mr. President, do you have any 
comment on the sentencing of Dr. Fuchs? ® 

THE PRESIDENT. No Comment. 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You're welcome. 

note: President Truman's two hundred and nine- 
teenth news conference was held in his office at the 
White House at 10:30 a.m. on Thursday, March 2, 
1950. 



^Dr. Klaus Fuchs, German-born official of the 
British Government's atomic energy establishment, 
who was sentenced on March i to 14 years in prison 
for disclosing atomic secrets to the Soviet Union. 



47 Letter to the Chairman, House Committee on Education and 
Labor, on Federal Aid to Education. March 2, 1950 



Dear Chairman Lesins\i: 

I have received your letter of March first, 
and the enclosed resolution with respect to 
Federal aid to education that was adopted by 
the Committee on Education and Labor. 

The text of that resolution as transmitted 
to me is as follows: 

"resolution 

"Whereas the Committee on Education 
and Labor of the House of Representatives 
in no way wants to report legislation that 
might lead to Federal Control of the schools 



of America; and 

"Whereas the United States Office of 
Education is a department within the Fed- 
eral Security Agency and this committee has 
had no assurance from the President that the 
Commissioner of Education will have, by 
Presidential authorization, sole jurisdiction 
over the administration and conduct of all 
provisions of any act on Education that 
might be reported out of committee without 
interference from the Administrator of the 
Federal Security Agency or any of his ap- 
pointed assistants; and 

"Whereas this Committee requests this 



41-355—65 



-15 



185 



[47] Mar. 



Public Papers of the Presidents 



assurance in all good faith and sincerity so 
that in no manner in the years to come could 
their consideration of Federal Aid to Educa- 
tion be construed to mean that they sup- 
ported legislation that might lead to Federal 
Control of the schools of America; Therefore 
be it 

"Resolved, That the Committee on Edu- 
cation and Labor of the House of Representa- 
tives will not report any bills pertaining to 
Federal Aid to the Public Schools of America 
until the President of the United States sub- 
mits a statement to said Committee clarifying 
the authority and re-defining the duties of 
the United States Commissioner of Education 
with regard to all functions of the adminis- 
tration of school laws — and that the President 
inform the Federal Security Administrator 
of this clarification." 

According to this resolution, the Commit- 
tee on Education and Labor is opposed to 
Federal control of the schools of America. 
I, too, am opposed to Federal control of the 
schools. I have so stated many times, and 
that continues to be my position. The gov- 
ernments of the states, the schools of Amer- 
ica, the citizens who have responsibility for 
the welfare of our educational system are also 
opposed to Federal control of the schools of 
America. The Senate of the United States, 
when it passed a bill to provide for Federal 
aid to education, made it perfectly clear that 
it was opposed to Federal control of the 
schools, and the terms of that bill are explicit 
in prohibiting Federal control of the schools. 
On this question, there seems to be general 
agreement. 

The resolution you have transmitted to me 
proceeds, however, by a process of reasoning 
which I do not follow, to relate this prin- 
ciple of freedom from control to the position 
of the Office of Education in the Federal 
Security Agency. If there is to be no Federal 
control in any case, I fail to see how any Fed- 
eral control can grow out of any possible 



relationship between these two offices. 

When I say I am opposed to Federal con- 
trol of the schools, I mean I am opposed to 
control by any officer or department of the 
Federal Government, whether it be the 
United States Office of Education, the Fed- 
eral Security Agency, or any other bureau 
or official. I, therefore, do not understand 
how the relationship between any of these 
offices or agencies is of any relevance to the 
problem of keeping the schools of America 
free of Federal control. 

The relationship between these offices and 
agencies is of importance in increasing eflS- 
ciency and effecting economies in the opera- 
tion of the Federal Government. In my 
recommendations for the organization and 
reorganization of the Federal Government, 
I shall continue to be guided by these princi- 
ples of greater efficiency and economy. I 
believe that these principles have the sup- 
port of the Congress and the great majority 
of the people. 

The task before the Committee on Edu- 
cation and Labor is to consider the need for 
Federal assistance to the schools, and the 
ways of meeting it, and then to devise a pro- 
gram which will, among other things, pre- 
vent all Federal officers who may have any- 
thing to do with its administration from 
excersing a control over matters which, we 
are all agreed, should be left to the States. 

The Commissioner of Education, the Fed- 
eral Security Administrator, or other officers 
of the Government cannot and will not do 
more than to exercise the functions and carry 
out the duties imposed by law on the Execu- 
tive branch. This will be true in the case 
of Federal aid to education, if such aid is 
authorized, as it is in all other matters. 

I see no reason why detailed questions of 
administrative organization should delay or 
impede the Committee in considering and 
acting upon the problem of Federal aid to 
education. I have long recommended the 



i86 



Harry S. Truman, ig^o 



Mar. 3 [49] 



creation of a new department which will 
include the present Office of Education and 
other governmental functions in the field of 
education, health, and welfare. I have rec- 
ommended that this department be orga- 
nized in accordance with the best principles 
of administrative management, which re- 
quire a degree of responsibility in the depart- 
ment head sufficient to reduce the number 
of inter-bureau controversies and issues that 
require Presidential attention. 

I do not see any reason to depart from 
these principles at this time. They will not 
in any way increase the powers of any Fed- 
eral officer over our schools if the Congress 
performs its task, as I am sure it will, of 
devising and enacting a satisfactory system 
of Federal aid based upon the concept that 
the control of education rests with the states. 



The schools of the country are laboring 
under increasing burdens, and the need of 
Federal action to protect our children from 
the growing blight of poor and inadequate 
education is ever more pressing. 

I sincerely hope that your Committee will 
soon complete favorable action on legislation 
of this character. I am sure that I can count 
on your support to this end. 
Very sincerely yours, 

Harry S. Truman 

( Honorable John Lesinski, Chairnian, Committee on 
Education and Labor, House of Representatives, 
Washington, D.C.] 

note: The President referred to a bill (S. 246) pro- 
viding for Federal aid to elementary and secondary 
schools, passed by the Senate on May 5, 1949, and 
under consideration by the House Committee on 
Education and Labor at the time of his letter. The 
bill was not reported out by the House Committee. 



48 Remarks to a Group From the Ninth Annual 
Science Talent Search. March 2, 1950 



WELL, it is a pleasure to have you here, 
and I appreciate Mr. Davis bringing you in. 
You have a career before you that is ab- 
solutely essential to the v^elfare of this great 
Nation of ours. 

The development of brains is much more 
important and much more necessary than 
the development of brawn, although we need 
both. We must have a good healthy body if 
we are going to have a good healthy mind. 
I believe in that sincerely. 

I am glad that you are prizewinners, and 
I hope you will continue your studies, as 



Mr. Davis says, to be of some practical use 
to this great country with scientific devel- 
opments for peace and for the welfare of 
the world. That is what we are working 
for most. 

note: The President spoke at 12:05 P-m. in his 
office at the White House. In his opening words 
he referred to Watson Davis, Director of Science 
Service, who conducted the talent search for West- 
inghouse Electric Corporation. 

The group was composed of 40 young men and 
women from 15 States. All were winners of 
Westinghouse Science Scholarships awarded by the 
Corporation. 



49 Special Message to the Congress on the Coal Strike. 
March 3, 1950 



To the Congress of the United States: 

I wish to report to the Congress on the 
emergency confronting the Nation as a result 



of a shortage of coal, and to recommend legis- 
lative action. 

Since February 6, 1950, the production of 



187 



[49] Mar. 3 



Public Papers of the Presidents 



bituminous coal has been dangerously cur- 
tailed. By now, stocks of coal are almost 
exhausted, and many parts of our country 
face crisis conditions. The anthracite coal 
which is being produced, and the trickle of 
soft coal output, together have been enough 
to stave off human suffering. But the lack 
of normal production of soft coal is bringing 
many basic industries to a halt. 

A variety of emergency measures have 
been taken in recent days and weeks. Trans- 
portation and utility services have been cut 
down. Available supplies in many locali- 
ties have been redistributed in order to meet 
the most urgent needs. Other steps have 
been taken by States and cities, by indus- 
tries and by suppliers, to conserve the 
dwindling stocks of coal. These efforts have 
stretched our national stockpile, but they 
cannot add to it. Within a very few days we 
shall be virtually out of soft coal. The dan- 
ger to the national health and safety is real 
and immediate. It requires action at once. 

The immediate reason for the curtailment 
of bituminous coal production is a dispute 
between most of the mine operators and the 
principal union of mine workers, the United 
Mine Workers of America, over the terms 
and conditions of employment in the mines. 

The previous contract between the union 
and the operators expired June 30, 1949. In 
subsequent months, the mines operated inter- 
mittently, while negotiations for a new con- 
tract were under way. But these negotia- 
tions failed to produce agreement, and the 
miners went on strike on February 6, 1950. 

On January 31, in an effort to avert this 
situation, I asked the operators and the union 
to agree to continue production, in the 
national interest, for 70 days, while a fact- 
finding board reviewed the issues and recom- 
mended fair and reasonable terms for settle- 
ment of the dispute. While this request was 
accepted by the operators, it was rejected by 
the union. 



Thereafter, when negotiations were 
broken off and the strike occurred, I estab- 
lished a Board of Inquiry under the Labor 
Management Relations Act, 1947. It was 
this Board's duty, under the law, to find the 
facts and to report them, but not to make 
recommendations. 

The Board reported to me on February 11. 
It found that during all the months of nego- 
tiation, neither side had bargained freely and 
effectively on the essential issues in dispute. 
The Board also expressed a conviction which 
deserves emphasis today. The Board con- 
cluded that "The obligation entrusted to the 
Operators and to the Union, as the agent of 
the employees, to serve in a joint stewardship 
of these vital resources must be met. The 
health and safety of the Nation demand this." 

On the basis of the Board's findings, along 
with the other evidence available, the At- 
torney General on February 11, at my direc- 
tion, requested the United States District 
Court for the District of Columbia to enjoin 
the union from continuing the strike and to 
order both parties to bargain in good faith. 
That same day, the Court issued a temporary 
restraining order to accomplish these 
purposes. 

As a result, the parties renewed bargaining 
negotiations on February 15. The Board of 
Inquiry was reconvened and met repeatedly 
with the parties, in cooperation with the Di- 
rector of the Federal Mediation and Concilia- 
tion Service, in an effort to bring about 
agreement. 

But while negotiations have continued, the 
miners have not returned to work. On Feb- 
ruary 20, the Attorney General started pro- 
ceedings against the union, charging that it 
had not obeyed the order enjoining the con- 
tinuance of the strike, and that it was there- 
fore in contempt of court. This action was 
taken in light of the fact that the work stop- 
page was still under way nine days after 
the Court's order. On March 2, the Court 



188 



Harry S. Truman, ig^o 



Mar. 3 [49] 



found that the union was not in contempt. 

It is evident that the order of the Court 
has not brought forth production. The 
mines are still shut down. Events since the 
issuance of the Court's order on Febru- 
ary II give us no assurance that Court ac- 
tion under present law can, in fact, end the 
work stoppage in time to avert exhaustion 
of our coal supplies. 

The Nation's welfare requires that soft 
coal production be resumed at once, in or- 
der to prevent human suffering and disas- 
trous economic dislocation. Since the union 
and the operators have failed to resume pro- 
duction, and since recourse to the Court has 
so far proved ineffective, it is now my plain 
duty to propose further action. Therefore, 
I recommend that the Congress enact legis- 
lation authorizing the Government to take 
over the coal mines and operate them tem- 
porarily as a public service. 

The parties are continuing their negotia- 
tions, and I earnesdy hope that they will 
reach agreement before it actually becomes 
necessary for the Government to take posses- 
sion of the mines. But we can wait no 
longer to prepare ourselves with the neces- 
sary legislative authority. 

I am submitting at this time a draft of 
legislation to accomplish this purpose. I 
earnestly request that the Congress consider 
this proposal and enact the needed legisla- 
tion as quickly as possible. 

In requesting this legislation, it is my pur- 
pose and intention to restore the produc- 
tion of badly needed coal. During the period 
of Government possession of the mines, the 
owners should receive fair and just compen- 
sation for the use of their property, and the 
miners should receive fair and just compensa- 
tion for their work. The proposed legisla- 
tion would authorize the establishment of 
impartial boards to make recommendations 
concerning fair and just compensation for the 
use of the property of the mine owners and 



for the work of the mine employees. 

I am not requesting this legislation as a 
means of settling the issues in dispute be- 
tween the operators and the union. They 
will have to settle their differences through 
their own collective bargaining, just as 
though Government operation were not in 
effect. I do not propose to substitute the 
Government's representatives for the private 
operators at the bargaining table. It will not 
be our purpose to establish wages, hours, or 
working conditions which would bind either 
the operators or the miners upon resumption 
of private operations. When the country can 
be assured of sufficient supplies of coal, the 
Government will have no need to continue 
public operation and the mines will be 
promptly returned to private hands. 

I have stressed these essential elements 
in the plan for Government operation, so 
that there will be no misunderstanding of 
the legislation I am recommending. The 
draft bill which I propose for consideration is 
necessarily quite general, so that the Govern- 
ment may adapt the details of its operations 
to changing circumstances. But while the 
legislative language can best be framed in 
general terms, there should be no mistaking 
the contemplated relationships of the Gov- 
ernment with the operators and the miners 
during the period of public operation. 

There are other issues in this emergency 
than the Nation's urgent need for coal. This 
crisis raises vital questions for the future of 
the coal industry. 

We have arrived at the present impasse 
because both the operators and the union 
have failed, month after month, to make the 
efforts in genuine bargaining which could 
result in a mutually satisfactory settlement. 
They have been unwilling or unable to lay 
aside their charges and counter-charges, 
moderate their fixed positions and undertake 
serious negotiation in a spirit of accommo- 
dation and mutual understanding. 



189 



[49] Mar. 3 



Public Papers of the Presidents 



They have been unwilling or unable to do 
so despite the country's desperate need, de- 
spite the growing distress of the idle miners 
and their families and the economic losses 
incurred by idle facilities, despite the com- 
petitive advantage which their long dispute 
is giving to other fuels. 

Fortunately, this dangerous breakdown in 
the normal course of labor-management re- 
lations does not characterize most industries 
in this country. On the contrary, collective 
bargaining has generally produced sustained 
production and mutual benefits, without 
these serious consequences for the public and 
this need for extreme governmental action. 

But the coal industry has failed signally to 
solve its own problems in the field of labor- 
management relations. The current failure 
is only the latest of a series which stretches 
back over many years, recurring with dis- 
heartening regularity. We can only assume 
that if this industry continues as it has been 
going, we shall be faced repeatedly with 
situations of this kind. We shall be forced 
every so often into governmental action of 
one kind or another — action which cannot 
solve the underlying problems or remedy 
the failures of the private parties, but which 
is necessary to shield the pubUc from their 
consequences. 

These recurrent breakdowns between 
labor and management in the coal industry 
are only symptoms of profound and long- 
standing economic and social difficulties in 
which the industry has become involved. 
We can hope to work toward real solutions 
of the unstable relations between labor and 
management in the coal mines, only if we 
come to grips with the problems which foster 
instability. 

I further recommend, therefore, that the 
Congress establish a commission of inquiry, 
including members from the Congress, the 
Executive Branch, and the public, to make 
a thorough study of the coal industry, in 



terms of economic, social, and national secu- 
rity objectives. The draft of legislation 
which I am submitting at this time does not 
include provisions for establishing such a 
commission. However, I expect to submit 
a draft of legislation for that purpose to the 
Congress at an early date. 

Management in this industry is confronted 
by declining markets, severe competition, 
and the high cost of efficient, modern equip- 
ment. Labor faces arduous work, a harsh 
physical environment, an uncertain work 
year, and the prospect of fewer jobs. The 
Nation needs an assured supply of coal at 
all times, and readily available reserves to 
buttress our national security. 

It is essential that the commission examine 
carefully and factually each one of these con- 
ditions, probing the realities behind them 
and taking stock of our national needs and 
resources, human and material. We should 
then be able to determine what kinds of 
actions and what sorts of policies on the part 
of Government, management, and labor, 
will restore the coal industry to economic 
health and provide a stable environment for 
constructive relationships between the oper- 
ators and their employees. 

This is the real challenge of the present 
situation. It is a test of our ability to find 
a way to achieve adequate production of a 
raw material basic to our national life, while 
preserving the fundamental values of our 
free institutions. Both our friends and our 
detractors in the rest of the world are watch- 
ing to see how our democratic society will 
meet this challenge. 

The coal industry is a sick industry. Tem- 
porary seizure by the Government, though 
it may be necessary under present circum- 
stances, cannot produce a cure. I am recom- 
mending seizure authority because I believe 
we now have no alternative. But I urge that 
it be accompanied by a positive and con- 
structive efiFort to get at the root of the 



190 



Harry S. Truman, ig^o 



Mar. 7 [50] 



trouble. This is in the interest of the men 
who work the mines. It is equally in the 
interest of their employers. Above all, it 
is in the interest of the American people. 

I urge the Congress, therefore, to act 
immediately on legislation to authorize the 
Government to take possession of and oper- 
ate the mines, and then to turn its atten- 



tion to legislation looking toward a solution 
of the basic difficulties of the coal industry. 

Harry S. Truman 

note: The draft bill, transmitted with the Presi- 
dent's message, is printed in House Document 492 
(8ist Cong., 2d sess.). 
See also Items 27, 35, and 50. 



50 Letter to the President of the Senate and to the Speaker of 
the House Transmitting Bill for the Establishment of a 
Commission on the Coal Industry. March 7, 1950 



Dear Mr, ; 

In my message of March 3, 1950, to the 
Congress, I urged the Congress to act im- 
mediately on legislation to authorize the 
Government to take possession of and oper- 
ate the coal mines. I submitted with that 
message a draft of a bill appropriate for 
carrying out that recommendation. 

Since my message to Congress, the repre- 
sentatives of the miners and the representa- 
tives of the operators have negotiated a new 
contract and the miners are returning to 
work. The emergency situation which was 
the basis of my request for seizure authority 
no longer exists, therefore, and, accordingly, 
it is not necessary for the Congress to give 
further consideration to such legislation at 
this time. 

I also recommended in my message of 
March 3 that the Congress establish a com- 
mission, including members from the Con- 
gress, the Executive Branch, and the pub- 
lic, to make a thorough study of the coal 
industry in terms of national economic, so- 
cial, and security objectives, and to recom- 
mend positive and constructive solutions for 
the basic problems of that industry. I stated 
that I expected to submit a draft of legisla- 
tion for that purpose to the Congress at an 
early date. 



Pursuant to this statement in my message 
of March 3, I attach for the consideration of 
the Senate (House of Representatives) a 
draft of legislation to establish a commission 
on the coal industry. The end of the coal 
strike has in no way diminished the need 
for a long-range study of the coal industry 
with the view of finding and putting into 
effect the best solutions of its problems from 
the standpoint of the miners, the operators, 
and, above all, the national interest. I, 
therefore, hope that the Congress will enact 
legislation of this character as soon as 
possible. 

Sincerely yours, 

Harry S. Truman 

note: This is the text of identical letters addressed 
to the Honorable Alben W. Barkley, President of the 
Senate, and to the Honorable Sam Rayburn, Speaker 
of the House of Representatives. 

The draft bill proposed a 9-member commission 
to be made up of two Senators, two Representatives, 
and five members to be named by the President. The 
proposal was studied by the Senate Committee on 
Interior and Insular AfFairs, but it was not con- 
sidered by the House. 

The 8 -month controversy in the coal industry 
ended on March 5 with the signing of a new con- 
tract between the mine operators and the miners, 
represented by the United Mine Workers of America. 
The new agreement provided that the miners re- 
ceive 70 cents more a day, and increased by 10 
cents a ton the operators' payments to the miners' 
welfare fund. 

See also Items 27, 35, and 49. 



191 



[51] Mar. 9 



Public Papers of the Presidents 



51 Statement by the President on the Record of the Home 
Owners' Loan Corporation. March 9, 1950 



THIS OCCASION marks another step in 
the successful completion of the work of the 
Home Owners' Loan Corporation. It has 
already paid off the last of its $3,500 million 
of bonded indebtedness. It is now making 
its first repayment, of $26 million, to the 
United States Treasury on the $200 million 
advanced by the Government in 1933 as 
capital stock. 

Today the HOLC is over 95 percent liqui- 
dated. Through earnings on its loans, it has 
paid its own administrative expenses, and 
offset the real estate losses which it had to 
meet. It is now expected that when the 
HOLC is fully liquidated, the Treasury will 
have been repaid its capital advance in full, 
plus a surplus of several million dollars. 

The Home Owners' Loan Act was one of 
the emergency measures passed during the 
first days of the Democratic administration 
in 1933. Foreclosures on city homes were 
then running at the rate of 1,000 every day. 

In 3 years the HOLC refunded the over- 
due mortgages of more than i million fami- 
lies with long-term loans at lower interest 
rates. These loans, with later advances, 
amounted to nearly %'^Vi billion. 

Not only did these funds save families 
from foreclosure. At the same time, they 
enabled banks, insurance companies, savings 
and loan associations and other real estate 
investors to exchange defaulted mortgages 
for $2% billion in cash and Government 
bonds. This new life blood saved many 
hundreds of financial institutions — permit- 
ting them to pay off their depositors or in- 
vestors as necessary and to remain in busi- 
ness. 

Furthermore, the HOLC program aided 
city and town governments in meeting their 
payrolls and keeping up their essential serv- 
ices. As payment for the overdue taxes of 



HOLC borrowers, local governments re- 
ceived nearly half a billion dollars in less 
than 3 years. 

In all these ways the HOLC program was 
an outstanding example of the intelligent 
investment of public funds to meet urgent 
depression needs — helping to save homes, 
businesses, and local governments from the 
disastrous effects of widespread unemploy- 
ment and loss of income. 

The families whose homes were saved 
were encouraged to hold on to their prop- 
erties and repay their loans. In the depres- 
sion years, they scrimped and sacrificed to 
meet their monthly payments; in later years, 
when times were better, they often made pay- 
ments in advance — ^many paying off their 
debts in full far ahead of schedule. 

When the HOLC was started some people 
expressed the fear that the experiment of 
direct Government lending to homeowners 
in default on their mortgages and taxes 
might cost the Treasury huge losses. But 
those who supported the program had faith 
in the future. They knew that through 
vigorous public and private action the down- 
ward spiral of depression could be reversed, 
and that these loans would be sound assets 
which would be repaid in full. That is what 
happened. 

The record of the Home Owners' Loan 
Corporation illustrates a lesson that has been 
proved time and time again in recent years. 
It is that by wise use of its powers, the Gov- 
ernment can engage in broad programs of so- 
cial benefit — ^and conduct them efficiently 
and without waste of public funds. 

The Home Owners' Loan Corporation was 
successful in terms of dollars and cents. 
But, much more important, it was successful 
in terms of human values — ^in helping hun- 
dreds of thousands of families to maintain 



192 



Harry S. Truman, ig^o 



Mar. 9 [52] 



themselves as self-reliant homeowners, se- 
cure in their hard-earned property, and free 
of the threat of eviction through no fault of 
their ov^n. 



We should all be proud of this demonstra- 
tion of bold and constructive Government ac- 
tion for the good of the whole country. 



52 The President's News Conference of 
March 9,. 1950 



THE PRESIDENT. I have no special announce- 
ments to make this afternoon. I will try to 
answer questions. 

[i.] Q. Mr. President, may we take the 
appointment of Martin Hutchinson to the 
Federal Trade Commission as an indication 
of a trend; that is, of more top-level appoint- 
ments among southern Truman men? 

THE PRESIDENT. Why, I don't know 
whether to take it as a trend or not. 
I expect to appoint people on whose quali- 
ties and qualifications I can depend. 

Q. Can you find some more down South? 

THE PRESIDENT. I bcUeve I Can. I am very 
sure I can. [Laughter] 

[2.] Q. Mr. President, Ambassador 
Bay, Ambassador to Norway, was in to 
see you today. Is he going to be the new 
Chairman of the National Security Re- 
sources Board? 

THE PRESIDENT. No. Hc is Ambassador 
to Norway, and he is going to stay Ambas- 
sador to Norway. 

Q. Mr. President, what is the progress on 
the National Security Resources Board? 

THE PRESIDENT. I bcg your pardon? 

Q. What is the progress on the National 
Security Resources Board? 

THE PRESIDENT. One of these days I will 
make an announcement to you, and you will 
know all about it. 

[3.] Q. Mr. President, when you are out 
West, are you going to do any campaign- 
ing in California for Senator Downey or his 
rival? 



THE PRESIDENT. I have no intention of go- 
ing to California. 

Q. Mr. President, on the Western trip, 
Secretary Chapman said this morning that 
he expected you to go out to Grand Coulee, 
and possibly also to the dedication of a dam 
in Wyoming? 

THE PRESIDENT. That trip has been only in 
the discussion stage. We hope to get it ar- 
ranged for the first part of May, if that is 
possible. As soon as definite arrangements 
are made, why, I will announce it to you 
so you can have plenty of time to pack your 
grips. 

Q. Is it your hope to take in the Chicago 
meeting also on the same trip? 

THE PRESIDENT. There has been some talk 
on that subject. 

Q. Is it definite 

THE PRESIDENT. Nothing has been defi- 
nitely arranged. 

Q. Is it definite yet, Mr. President, on the 
Chicago stop? 

THE PRESIDENT. No. All this is tentative. 
As soon as we have the thing sewed up, why, 
I will announce it to you in a form that you 
will understand every word of it, so that you 
will have plenty of time to get ready. 

Q. Mr. President, just to clarify my think- 
ing on that — [laughter] — when you said 
that you are not going to California, does 
that rule out the November campaign in 
California? 

THE PRESIDENT. I havc no intention of 
going to California. 



41-355—65- 



-16 



193 



[52] Mar. 9 



Public Papers of the Presidents 



Q. You don't rule out the November cam- 
paign? 

THE PRESIDENT. No, not neccssarily. 

[4.] Q. Mr. President, there is to be a 
meeting of the Inter- American Economic and 
Social Council here March 20, apparently 
with general representation from Latin 
America and a very active interest in the 
point 4 program, among other things. Has 
this conference required your official atten- 
tion, or do you wish to make any observa- 
tions about it? 

THE PRESIDENT. No. No, I do nOt. 

Q. Any chance of your speaking at that 
meeting, sir? 

THE PRESIDENT. I hardly think so. If it is, it 
will be a long-distance speech. [Laughterl 

[5.] Q. Mr. President, would you care to 
comment on the suggestion of Governor 
Luis Munoz Marin, to permit the people of 
Puerto Rico to adopt their own constitution? 

THE PRESIDENT. I have no comment on that. 

[6.] Q. Mr. President, any new nomina- 
tions in mind for the Atomic Energy Com- 
mission? 

THE PRESIDENT. No. If I havc them, I will 
announce them to you in the beginning. 

Q. There is a report that there is no inten- 
tion of filling the full membership. Is that — 
anything to that? 

THE PRESIDENT. I haveu't heard it. But 
you can hear anything — ^you can hear all 
sorts of rumors about anything you want to 
start. This is the best rumor town in the 
world. But I hadn't heard that one. That's 
a new one. 

Q. What do you think of Senator Ty- 
ding's idea for one military but not more 
than two military men in regular service on 
that Commission? 

THE PRESIDENT. I think that was setded by 
the 79th Congress, and then, you know, it 
was somewhat balled up by the 8oth Con- 
gress; but that ruling of the 79th was my 



recommendation and still stands — civilian 
control of atomic energy. 

[7.] Q. Mr. President, recently quite a 
good many European leaders expressed 
agreement with the idea of integration and 
unity of Europe. I wonder if you had read 
those statements, and whether you would 
comment 

THE PRESIDENT. Yes, I havc, and I am very 
much pleased with the attitude of the Euro- 
pean correspondents and editors who have 
been writing those articles. I think they are 
on the right track. 

[8.] Q. Mr. President, has Congressman 
Sabath sold you on the idea of the Gossett- 
Lodge amendment? 

THE PRESIDENT. I didn't Understand the 
question. 

Q. Congressman Sabath is opposed to the 
idea of the Gossett-Lodge amendment, 
changing the method of election of a 
President? ^ 

THE PRESIDENT. Yes, I think he is opposed 
to it, but he told me the other day he was 
going to get a rule and let the House vote on 
it, which I hope he will do. 

[9.] Q. Mr. President, what do you think 
about the House action in approving state- 
hood for Alaska and Hawaii? 

THE PRESIDENT. I recommeuded it to them 
three different times. 

Q. You are still for it? 

THE PRESIDENT. Why Certainly! Can't 
change the Message on the State of the 
Union that quickly. [Laughter] 

Q. Well, one of my editors wanted me to 
say it over again. [More laughter] 

THE PRESIDENT. That's all right — that's all 
right. 

[10.] Q. Mr. President, the House Judi- 
ciary Committee delayed a vote on the civil 
rights bill. I wonder if you plan to ask 
the chairman to bring that out? 

^ See Item 29 [18]. 



194 



Harry S. Truman, ig^o 



Mar. 13 [53] 



THE PRESIDENT. I havc been urging that 
that be brought out for — ^let me see — it has 
been about 5 years now, hasn't it? I am still 
urging it. 

[11.] Q. Mr. President, there is a dis- 
pute in the House Labor Committee on 
Federal aid to education. There are two 
groups that seem to be for the general idea, 
but are conflicting in the nature of the bill. 
One of them 

THE PRESIDENT. I Can't Settle details and 
arguments 

Q. I was going to ask whether you are for 
the Senate bill ? 

THE PRESIDENT. 1 Can't Settle details 

and arguments between legislators as to how 
a bill is to be worded. I have expressed my 
opinion time and again on aid to educa- 
tion, and that opinion still stands as it was in 
the message each time. 

[12.] Q. Have you any observations on 
Senator McCarthy's charges ? 

THE PRESIDENT. Well, uo, I have no ob- 
servations to make on it. I think the Sen- 
ate committee is handling the situation very 
well. 

[13.] Q. Mr. President, has the chair- 
man of the Educational Labor Committee 
in the House assured you, like Mr. Sabath, 
that he would get the bill out? 



THE PRESIDENT. He has been in touch 
with me that he is sure to get the bill out ever 
since the Senate bill went over to the House. 
I haven't had a recent conversation with 
him on the subject individually. 

[14.] Q. Mr. President, do you have 
any observations on the British elections, now 
that it has 

THE PRESIDENT. No, I haven't. That is 
the business of the British. I have no com- 
ment to make on their internal private af- 
fairs. 

[15.] Q. Mr. President, there were re- 
ports a year or so ago, after a certain Navy 
ship went to Cuba, of various people aboard 
being seasick. Are any precautions being 
taken for the cruise next Sunday? 

THE PRESIDENT. The "Doc" Suggested a 
new medicine which he said is very good, 
so it will be available. 

Q. Is it liquid? [Laughter] 

THE PRESIDENT. Well, it's a kind of tablet, 
about as big as your thumbnail. That could 
be followed by certain liquid refreshment. 
[Laughter] 

Reporter: Thank you, Mr. President. 

THE PRESIDENT. You're entirely welcome. 
note: President Truman's two hundred and twen- 
tieth news conference was held in his office at the 
White House at 4 p.m. on Thursday, March 9, 1950. 



53 Special Message to the Congress Summarizing the New 
Reorganization Plans. March 13, 1950 



To the Congress of the United States: 

I am today transmitting to the Congress 
21 plans for reorganization of agencies of the 
Executive Branch. These plans have been 
prepared under the authority of the Reor- 
ganization Act of 1949. Each is accompa- 
nied by the message required in that Act. 

Our ability to make such comprehensive 
recommendations is due in large part to the 
outstanding work of the Commission on 



Organization of the Executive Branch of the 
Government. The plans which I am trans- 
mitting are all designed either to put into 
effect specific recommendations of the Com- 
mission or to apply principles set forth by 
the Commission in its reports. 

When these plans become effective, we 
shall have acted on almost half the proposals 
made by the Commission on Organization. 
I expect to transmit additional plans for 



195 



[53] Mar. 13 



Public Papers of the Presidents 



putting into effect other recommendations 
of the Commission later in the present ses- 
sion of Congress. 

The 21 plans I am transmitting today are 
designed to accomplish the following pur- 
poses: 

Plans 1-6 transfer to the heads of six de- 
partments the functions and powers now 
conferred by law on subordinate officials. 
The six departments affected are Treasury, 
Justice, Interior, Agriculture, Commerce, 
and Labor. 

Plans 7-13 fix responsibility for the day- 
to-day administration of seven regulatory 
boards and commissions in the chairmen of 
these bodies rather than in the members 
collectively. The agencies affected are the 
Interstate Commerce Commission, Federal 
Trade Commission, Federal Power Commis- 
sion, Securities and Exchange Commission, 
Federal Communications Commission, Na- 
tional Labor Relations Board, and Civil 
Aeronautics Board. 

Plans 14 and 19 transfer two functions to 
the Department of Labor from other Gov- 
ernment agencies. 

Plans 15-18 and 20 transfer certain func- 
tions to and from the General Services Ad- 
ministration in order to round out the 
organizational pattern of this agency, which 
was created last year. 

Plan 21 transfers the functions of the 
Maritime Commission to the Department of 
Commerce, where they are reconstituted in 
a Federal Maritime Board and a Maritime 
Administrator. 

The first 13 plans all have the same ob- 
jective — to establish clear and direct lines of 
authority and responsibility for the manage- 
ment of the Executive Branch. The heads 
of departments and the Chairmen of regu- 
latory bodies will be made clearly respon- 
sible for the effectiveness and economy of 
Governmental administration and will be 
given corresponding authority, so that the 



public, the Congress, and the President may 
hold them accountable for results in terms 
both of accomplishments and of cost. 

The Commission on Organization placed 
great stress upon the establishment of clear 
lines of authority and responsibility. This 
was, in fact, the very first of its recommenda- 
tions. The opening three paragraphs on the 
first page of its initial report read as follows: 

"In this part of its report, the Commission 
on Organization of the Executive Branch of 
the Government deals with the essentials of 
effective organization of the executive 
branch. Without these essentials, all other 
steps are doomed to failure. 

"The President, and under him his chief 
lieutenants, the department heads, must be 
held responsible and accountable to the 
people and the Congress for the conduct of 
the executive branch. 

"Responsibility and accountability are im- 
possible without authority — the power to 
direct. The exercise of authority is impos- 
sible without a clear line of command from 
the top to the bottom, and a return line of 
responsibility and accountability from the 
bottom to the top." 

Again, in its report on regulatory agencies, 
the Commission made the centering of ad- 
ministrative responsibility its first recom- 
mendation, writing as follows: 

"Administration by a plural executive is 
universally regarded as inefficient. This has 
proved to be true in connection with these 
commissions. . . . We recommend that all 
administrative responsibility be vested in the 
chairman of the commission." 

Through these plans, authority placed by 
law in subordinate officials is transferred to 
the heads of the six departments. In the case 
of the State and Post Office Departments, 
comparable authority was placed in the de- 
partment heads by legislation and reorgani- 
zation action effected last year. 

Another feature of the departmental plans 



196 



Harry S. Truman, ig^o 



Mar. 13 [53] 



is the establishment of Administrative Assist- 
ant Secretaries in each of these six depart- 
ments. These positions are established in 
order to provide top-level assistance to each 
department head in the heavy managerial 
responsibilities of his office. They are set up 
within the classified civil service for the pur- 
poses both of achieving continuity in office 
and of obtaining persons with the greatest 
experience in the specialized functions of 
management. 

In regard to the regulatory agencies, the 
plans distinguish between two groups of 
functions necessary to the conduct of these 
agencies. One group includes the substantive 
aspects of regulation — that is, the determina- 
tion of policies, the formulation and issu- 
ance of rules, and the adjudication of cases. 
All these functions are left in the board or 
commission as a whole. The other group of 
functions comprises the day-to-day direction 
and internal administration of the complex 
stafi organizations which the commissions 
require. These responsibilities are trans- 
ferred to the chairmen of the agencies, to be 
discharged in accordance with policies which 
the commissions may establish. The chair- 
man is to be designated in each agency by 
the President from among the Commission 
members. 

In plan No. 12, unified responsibility is 
once more established in the National Labor 
Relations Board by transferring to the Board 
and its Chairman the functions of the Gen- 
eral Counsel and by abolishing the statutory 
office of the General Counsel. This plan will 
bring to an end the confusion which has 
resulted from divided responsibility. 

The changes embodied in the first 13 
plans are fundamental to the sustained drive 
we have undertaken to increase effective 
and economical management of the Execu- 
tive Branch. Only by placing in the heads of 
departments and agencies the authority nec- 
essary to direct and supervise the machinery 



of the Executive Branch can the maximum 
benefit be attained from the reorganization 
and reassignment of the functions which 
make up that branch. 

The 8 remaining plans propose reassign- 
ment of certain functions. They will take us 
further toward the goal of grouping the pro- 
grams of the Government in the smallest 
practicable number of departments and agen- 
cies organized according to major purpose. 

Transfer of the functions of the Maritime 
Commission to the Department of Com- 
merce through plan No. 21 will mark a long 
step forward in the integration of the many 
Governmental programs affecting transpor- 
tation. This step, again, is in accord with 
the recommendations of the Commission on 
Organization of the Executive Branch. 

For more than a decade, the Department 
has been in the process of becoming the ma- 
jor transportation agency of the Government. 
The establishment of the Civil Aeronautics 
Administration within the Department was 
the first major move in this direction. The 
transfer of the Weather Bureau to the De- 
partment was based in large part on that Bu- 
reau's importance to transportation. One 
of the reorganization plans which I trans- 
mitted to the Congress last year transferred 
the Bureau of Public Roads to the Depart- 
ment. Now, with the addition of the func- 
tions of the Maritime Commission, the De- 
partment will have jurisdiction over the 
major portion of the operating aspects of the 
programs of the Government relating to air, 
highway, and water transportation, as well as 
over the development and coordination of 
policies affecting the Nation's transportation 
system as a whole. 

Plan No. 21 estabHshes in the Department 
of Commerce a three-man Federal Maritime 
Board and a Maritime Administration under 
a Maritime Administrator. The award of 
subsidies and all regulatory functions are 
transferred from the present Maritime Com- 



197 



[53] Mar. 13 



Public Papers of the Presidents 



mission to the new Board. The remaining 
functions of the Maritime Commission, in- 
volving ship construction and other admin- 
istrative operations, are transferred to the 
Department of Commerce for execution 
through the Maritime Administration. 

The plan also provides for appointment of 
an Under Secretary of Commerce for Trans- 
portation, vi^ho vv^ill assist the Secretary in 
the direction and coordination of the trans- 
portation activities now centered in the De- 
partment. 

In plans Nos. 14 and 19 the Department 
of Labor is given two new functions — the 
Bureau of Employees' Compensation, trans- 
ferred from the Federal Security Agency; 
and the responsibility for coordination of the 
enforcement of wages and hours legislation 
affecting Federal or Federally-financed con- 
tracts. These two steps will further strength- 
en the Department of Labor as the center 
of responsibility for Governmental pro- 
grams which protect the welfare of em- 
ployees. This is the same essential purpose 
that underlay the transfer last year of the 
Bureau of Employment Security to the De- 
partment. 

The remaining five plans represent a logi- 
cal evolution of the responsibilities of the 
new General Services Administration. Two 
of these plans (18 and 20) transfer addi- 
tional service responsibilities to the General 
Services Administration; and the other 
three (15-17) remove from it various in- 
appropriate functions it received from the 
recendy abolished Federal Works Agency. 

In plan No. 18 the Administrator of Gen- 
eral Services is given expanded authority 
over the acquisition and control of Federal 
office space, particularly outside the Dis- 
trict of Columbia. He is also assigned 
the responsibility by plan No. 20 for the 
preservation and publication of certain pub- 
lic documents, such as laws and territorial 
papers, now handled by the Department of 



State, but unrelated to the foreign affairs 
mission of the Department. 

Plans 15-17 transfer from the Administra- 
tion six programs relating to pubUc works, 
community facilities and school aid. Alaska 
and Virgin Islands public works functions 
are transferred by plan No. 15 to the Depart- 
ment of the Interior; assistance to school dis- 
tricts overburdened by Federal activities and 
certain water pollution control functions are 
assigned by plan No. 16 to the Federal Secu- 
rity Agency; and advance planning of non- 
Federal public works and the management 
and disposal of war public works are trans- 
ferred to the Housing and Home Finance 
Agency by plan No. 17. 

When considered in conjunction with the 
reorganization plans and legislation which 
were made effective in 1949, these 21 plans 
bring near to realization certain major goals 
that have been set forth by the Commission 
on Organization. These are the same goals 
toward which the Congress was aiming 
when it enacted the Reorganization Act of 
1949, and toward which I have been working 
in the exercise of my duties as the manager 
responsible for the efficiency and economy of 
the Executive Branch. 

The first of these goals is to improve over- 
all management of the Executive Branch. 
During 1949 the agencies comprising the 
Executive Office of the President were re- 
grouped, the internal organization of the 
Civil Service Commission was strengthened 
to equip it for leadership in personnel ad- 
ministration, and the housekeeping func- 
tions of the Government as a whole were 
consolidated in a new General Services Ad- 
ministration. Today's plans provide fur- 
ther improvement in the organization of the 
last of these agencies. 

The second objective is to improve the 
internal management of individual depart- 
ments and agencies. Congressional and ad- 
ministrative action last year strengthened 



198 



Harry S. Truman, i^^o 



Mar. 13 [54] 



the structure of three departments — State, 
Defense, and Post Office — and clarified the 
management authority of the Department 
heads. Today's plans lay comparable foun- 
dations for improving the internal manage- 
ment of the remaining six departments and 
of seven regulatory agencies. 

The third general goal is to reduce the 
number of Governmental agencies and to 
group functions according to the primary 
purposes of these agencies. Progress v^^as 
made last year in the grouping of functions 
relating to transportation and to labor. To- 



day's plans deal again with those two areas, 
as well as eifiFecting other significant shifts. 

The reorganization and modernization of 
the Government may never be called com- 
plete. I am confident, however, that these 
plans will take us well along the road toward 
more effective, economical and responsible 
Government. 

Harry S. Truman 

note: For the President's messages to Congress 
transmitting Reorganization Plans 1-2 1, see Items 

54-76. 



54 Special Message to the Congress Transmitting Reorganization 
Plans I Through 13 of 1950. March 13, 1950 



To the Congress of the United States: 

I am transmitting today Reorganization 
Plans Nos. i to 13 o£ 1950, designed to 
strengthen the management of six executive 
departments and seven regulatory commis- 
sions. These plans propose a major clari- 
fication of the lines of responsibility and au- 
thority for the management of the Executive 
Branch. They would put into effect the 
principal remaining recommendations of the 
Commission on Organization of the Execu- 
tive Branch of the Government affecting the 
location of management responsibility with- 
in the departments and agencies. 

A principal finding of the Commission 
on Organization was that clean-cut lines of 
authority do not exist in the Executive 
Branch. The Commission stated that "the 
first and essential step in the search for ef- 
ficiency and economy in the Executive 
Branch of the Federal Government" is to 
correct the present diffusion of authority and 
confusion of responsibility. The Commis- 
sion warned that without this action "all 
other steps to improve organization and 
management are doomed to failure." 
Reorganization Plans Nos. i to 13 pro- 



pose a bold approach to the problem of de- 
lineating responsibility and authority for the 
management of the Executive Branch. 
Clearer lines of responsibility and author- 
ity will strengthen our constitutional system 
and will also help to establish accountability 
for performance in office — a basic premise of 
democratic government. I urge the Con- 
gress to add its approval to my acceptance 
of these recommendations of the Commis- 
sion on Organization. 

Reorganization Plans Nos, i to 6, Relating 
to Six Executive Departments, 

Reorganization Plans Nos. i to 6, inclu- 
sive, relate to the Departments of the Treas- 
ury, Justice, the Interior, Agriculture, Com- 
merce, and Labor. With certain exceptions, 
these plans transfer to the respective depart- 
ment heads the functions of other officers and 
agencies of the departments. They permit 
each department head to authorize the func- 
tions vested in him to be performed by any 
officer, agency, or employee of the depart- 
ment. In addition. Administrative Assistant 
Secretaries are provided for each of the six 
departments, and additional Assistant Secre- 



199 



[54] Mar. 13 



Public Papers of the Presidents 



taries are authorized for the Department of 
the Interior and the Department of Agri- 
culture. 

In its introduction to its first report, the 
Commission on Organization stated two "es- 
sentials of effective organization." These 
are: 

"The President, and under him his chief 
lieutenants, the department heads, must be 
held responsible and accountable to the peo- 
ple and the Congress for the conduct of the 
executive branch," and 

"The wise exercise of authority is impos- 
sible without the aids which staff institu- 
tions can provide to assemble facts and rec- 
ommendations upon which judgment may 
be made and to supervise and report upon 
the execution of decisions." 
The Commission specifically recommended: 

"Under the President, the heads of de- 
partments must hold full responsibility for 
the conduct of their departments," and 

"Department heads must have adequate 
staff assistance if they are to achieve effi- 
ciency and economy in departmental opera- 
tions." 

These six reorganization plans put into effect 
these recommendations. 

Through the years the Congress has re- 
peatedly endorsed the policy of holding 
agency heads fully accountable for all the 
functions of their agencies. Last year this 
policy was pursued in the legislation author- 
izing reorganization of the Department of 
State and establishing the General Services 
Administration. A reorganization plan 
applying this principle to the Post Office 
Department was likewise approved. 

However, in the six departments covered 
by these plans, all functions are not now 
uniformly vested in the department heads. 
Some statutory authority is held independ- 
endy by subordinate oiSScers and agencies. 
These plans extend fully to the six depart- 
ments the principles of strengthening de- 



partmental management by eliminating the 
patchwork exceptions that now exist. 

The transfers recommended in these plans 
accomplish three principal objectives. First, 
they provide a clearer line of responsibility 
and authority from the President through 
the department heads down to the lowest 
level of operations in each department. 
Second, department heads are made respon- 
sible in fact for activities within their agen- 
cies for which they are now, in any case, held 
accountable by the President, the Congress, 
and the people. Third, department heads 
are enabled to effect appropriate internal ad- 
justments as may be necessary within their 
departments to permit the most effective 
organization of departmental resources and 
bring about continuous improvement in 
operations. 

These reorganization plans exclude from 
transfer to the department heads two classes 
of functions which are retained in their 
present status. These are the functions of 
the hearing examiners appointed under the 
Administrative Procedure Act and the func- 
tions of government corporations in the 
departments. 

The provision in each of these plans for an 
Administrative Assistant Secretary is also 
based on a recommendation of the Commis- 
sion on Organization. These positions were 
recommended in order that each department 
head, in addition to being made fully re- 
sponsible for his department, be given ade- 
quate staff facilities to assist him in the 
managerial side of his responsibilities. The 
accomplishment of specific improvements in 
management can be made only through 
continuous attention to the effective perform- 
ance of such aids to management as budget- 
ing, accounting, personnel, and management 
analysis. 

For the government as a whole steps arc 
being taken in accord with the Commission's 
recommendations to improve the usefulness 



200 



Harry S. Truman, ig$o 



Mar. 13 [54] 



of these aids to management — steps toward a 
performance budget, improved accounting 
methods, better personnel administration, 
and government-wide management improve- 
ment. The results of these actions have been 
promising, but they demonstrate also that 
this work needs increased departmental at- 
tention. While the responsibilities of the 
Administrative Assistant Secretaries are not 
fixed by these plans, it is intended that these 
officials will work primarily on aiding the 
department heads to achieve better manage- 
ment. 

As recommended by the Commission on 
Organization, these reorganization plans 
provide for appointment of the Administra- 
tive Assistant Secretaries from the classified 
civil service and fix a salary at the top of 
that service. These plans also provide for 
appointment by the department heads with 
the approval of the President. Such a meth- 
od of appointment will tend to establish a 
career pattern for these positions extending 
across departmental lines. Presidential ap- 
proval will emphasize that the Administra- 
tive Assistant Secretaries should assume a 
government-wide approach to management 
problems. This arrangement is consonant 
with the authority placed in the President by 
the Classification Act of 1949 to designate 
positions in the top grade authorized under 
that Act. 

Two of the reorganization plans provide 
additional Assistant Secretaries, to be ap- 
pointed by the President and confirmed by 
the Senate, one in the Department of the 
Interior and two in the Department of Agri- 
culture. This step is in accord with recom- 
mendations of the Commission on Organiza- 
tion. The additional Assistant Secretaries 
are needed to provide more adequate staff 
assistance in supervising and directing the 
policies and programs of these large depart- 
ments. At present the Department of the 
Interior has two such officials and there is one 



such position in the Department of Agricul- 
ture. 

Under the provisions of Reorganization 
Plan No. 2 the tide of the Assistant to the 
Attorney General is changed to Deputy 
Attorney General, and an additional Assist- 
ant Attorney General is provided in lieu 
of the Assistant Solicitor General, the 
latter o£Sce being abolished. These changes 
are designed to reflect more accurately the 
position and responsibility of these two offi- 
cials of the Department of Justice. 

Reorganization Plans Nos. 7 to 75, Relating 
to Seven Regulatory Boards and Commis- 
sions 

Reorganization Plans Nos. 7 to 13, inclu- 
sive, relate to the Interstate Commerce Com- 
mission, the Federal Trade Commission, the 
Federal Power Commission, the Securities 
and Exchange Commission, the Federal 
Communications Commission, the National 
Labor Relations Board, and the Civil Aero- 
nautics Board. These plans are designed to 
strengthen the internal administration of 
these bodies by making the Chairman, rather 
than the commission or board as a whole, 
responsible for day-to-day administration. 
Also, the function of designating the Chair- 
man of these bodies is vested in the Presi- 
dent in those instances where this function is 
not already a Presidential one. 

These plans carry into effect the first and 
most important recommendation of the Com- 
mission on Organization relating to regu- 
latory commissions. The Commission rec- 
ommended "that all administrative respon- 
sibility be vested in the Chairman of the 
Commission." Its reasons were summarized 
as follows: 

"Purely executive duties — those that can 
be performed far better by a single admin- 
istrative official — ^have been imposed upon 
these commissions with the result that these 
duties have sometimes been performed badly. 



201 



[54] Mar. 13 



Public Papers of the Presidents 



The necessity for performing them has inter- 
fered with the performance of the strictly 
regulatory functions of the commissions." 
Elsewhere the Commission observed: 

"Administration by a plural executive is 
universally regarded as ineflScient. This 
has proved to be true in connection with 
these commissions." 

Since the creation of the Interstate Com- 
merce Commission in 1887, the board or com- 
mission has been an established form of 
Federal organization for regulatory activ- 
ities. The plural membership of each of 
these agencies has been based, presumably, 
on the usefulness of deliberation in the rule- 
making and adjudicative processes. How- 
ever, as their work has developed through 
the years, each of these agencies has become, 
in addition to a deliberative body, an orga- 
nization of staff elements whose work 
must be programmed and whose members 
must be recruited, supervised, and led. The 
smallest of these staffs is now over 600 in 
number and the largest over 2,000, and the 
difficulties of supervision are multiplied be- 
cause of the highly technical nature of the 
legal, engineering, accounting, and other 
skills which must be successfully interrelated. 

The commissions, concerned primarily 
with the substantive problems of regulation 
and with the adjudication of cases, cannot 
give adequate attention to the day-to-day 
executive direction of complex organiza- 
tions. To the extent that they have con- 
cerned themselves with administrative prob- 
lems, the unwieldiness of the structure has 
sometimes rendered administration slow, 
cumbersome, and indecisive. 

Accordingly, within the limitations ex- 
plained in later paragraphs, each of these 
plans vests in the Chairman, in each case, 
responsibility for appointment and super- 
vision of personnel employed under the com- 
mission, for distribution of business among 
such personnel and among administrative 



units of the commission, and for the use 
and expenditure of funds. 

In the conduct of all of these activities, the 
Chairman will be bound by the general 
policies established by the commission and 
by its regulatory decisions, findings, and 
determinations. In addition, the right is 
specifically reserved to the commission to re- 
vise budget estimates and determine the dis- 
tribution of funds among the major pro- 
grams and purposes of the agency. The 
appointment of the heads of major adminis- 
trative units under the commission is subject 
to approval of the commission, and each 
Commissioner retains responsibility for ac- 
tions affecting personnel employed regularly 
and full time in his immediate office. 

The proposals contained in these reorga- 
nizations are not new. Several of the com- 
missions have already made considerable 
progress in placing administrative respon- 
sibility in their Chairman. Therefore, the 
effect of these plans is to extend uniformly 
to all commissions a pattern of organization 
demonstrated by experience to be successful. 

The fact that under these reorganization 
plans the commissions retain all substantive 
responsibilities deserves special emphasis. 
The plans only eliminate multi-headed su- 
pervision of internal administrative func- 
tioning. The commissions retain policy con- 
trol over administrative activities since these 
are subject to the general policies and regu- 
latory decisions, findings, and determinations 
of the commissions. 

The plans do not contemplate that the 
Chairman will be relieved of any of his 
duties as a member and presiding ofiScer of 
the commission. They simply place on him 
the additional responsibilities for the opera- 
tions of the staff. The Chairman will need 
to establish the necessary administrative ar- 
rangements to carry out these responsibilities. 

Reorganization Plan No. 12 terminates 
the present division and confusion of respon- 



202 



Harry S. Truman, ig^o 



Mar. 13 [55] 



sibility in the National Labor Rdations 
Board by abolishing the office of the General 
Counsel of the Board. The Senate last 
year indicated its approval of this step. The 
reorganization plan in effect restores unified 
authority and responsibility in the Board. As 
in the case of the other plans for regulatory 
agencies, certain administrative and execu- 
tive responsibilities are placed in the Chair- 
man. The relationship betv^een the Board 
and the Chairman is identical with that pro- 
vided for the other regulatory agencies. This 
action eliminates a basic defect in the pres- 
ent organization of the National Labor Re- 
lations Board and provides an organizational 
pattern consistent with that established for 
the other regulatory agencies. 

In the plans relative to four commissions — 
the Interstate Commerce Commission, the 
Federal Trade Commission, the Federal 
Power Commission, and the Securities and 
Exchange Commission — the function of des- 
ignating the Chairman is transferred to the 
President. The President by law now desig- 
nates the Chairmen of the other three regu- 
latory commissions covered by these plans. 
The designation of all Chairmen by the 



President follows out the general concept 
of the Commission on Organization for pro- 
viding clearer lines of management responsi- 
bility in the Executive Branch. The plans 
are aimed at achieving more fully these 
management objectives and are not intended 
to affect the independent exercise of the 
commissions* regulatory functions. 

All thirteen of these reorganization plans 
will aid in making a more efficient govern- 
ment. The plans affecting the departments 
will help straighten out the lines of respon- 
sibility and authority, improve administra- 
tive accountability, and make departmental 
management sufficiendy flexible to meet 
changing problems. The plans relating to 
the regulatory commissions will result in the 
more businesslike and effective administra- 
tion of the Government's regulatory pro- 
grams. In short, these plans provide for 
better management of the executive depart- 
ments and regulatory commissions and thus 
will assure to the public the best possible 
service at the lowest possible costs. 

Harry S. Truman 

note: For further messages to the Congress on Re- 
organization Plans 1-13, see Items 55-67. 



55 Special Message to the Congress Transmitting Reorganization 
Plan I of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. I of 1950, prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Department 
of the Treasury. My reasons for transmit- 
ting this plan are stated in an accompanying 
general message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. i of 1950 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 



Reorganization Act of 1949. 

I have found and hereby declare that it is 
necessary to include in the accompanying 
reorganization plan, by reason of reorgani- 
zations made thereby, provisions for the 
appointment and compensation of an Ad- 
ministrative Assistant Secretary of the Treas- 
ury. The rate of compensation fixed for 
this officer is that which I have found to 
prevail in respect of comparable officers in 
the Executive Branch of the Government. 

The taking effect of the reorganizations 
included in this plan may not in itself result 



203 



[55] Mar. 13 



Public Papers of the Presidents 



in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years v^hich will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 



tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan i of 1950 is printed in 
House Document 505 (8ist Cong., 2d sess.). It 
did not become effective. 



56 Special Message to the Congress Transmitting Reorganization 
Plan 2 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herev^^ith Reorganization Plan 
No. 2 of 1950, prepared in accordance Wixh 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Department of 
Justice. My reasons for transmitting this 
plan are stated in an accompanying general 
message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. 2 of 1950 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

I have found and hereby declare that it is 
necessary to include in the accompanying 
reorganization plan, by reason of reorgani- 
zations made thereby, provisions for the ap- 
pointment and compensation of an Assistant 
Attorney General and an Administrative 



Assistant Attorney General. The rate of 
compensation fixed for these officers is that 
which I have found to prevail in respect of 
comparable officers in the Executive Branch 
of the Government. 

The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 2 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1261) and in 
the 1 949-1 953 Compilation of title 3 of the Code of 
Federal Regulations (p. 1002). It became effective 
on May 24, 1950. 



57 Special Message to the Congress Transmitting Reorganization 
Plan 3 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 3 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and pro- 
viding for reorganizations in the Depart- 
ment of the Interior. My reasons for 
transmitting this plan are stated in an ac- 
companying general message. 

After investigation I have found and 



hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 3 of 1950 
is necessary to accomplish one or more of 
the purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

I have found and hereby declare that it is 
necessary to include in the accompanying 
reorganization plan, by reason of reorgani- 
zations made thereby, provisions for the ap- 



204 



Harry S. Truman, ig^o 



Mar. 13 [59] 



pointment and compensation of an Assistant 
Secretary of the Interior and an Administra- 
tive Assistant Secretary of the Interior. The 
rate of compensation fixed for these officers 
is that which I have found to prevail in 
respect of comparable officers in the Execu- 
tive Branch of the Government. 

The taking effect of the reorganizations 
included in this plan may not in itself re- 
sult in substantial immediate savings. 
However, many benefits in improved op- 



erations are probable during the next years 
which will result in a reduction in expendi- 
tures as compared with those that would be 
otherwise necessary. An itemization of 
these reductions in advance of actual ex- 
perience under this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 3 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1262) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1003). It became ef- 
fective on May 24, 1950. 



58 Special Message to the Congress Transmitting Reorganization 
Plan 4 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 4 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Department 
of Agriculture. My reasons for transmitting 
this plan are stated in an accompanying 
general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 4 of 1950 
is necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

I have found and hereby declare that it is 
necessary to include in the accompanying 
reorganization plan, by reason of reorganiza- 
tions made thereby, provisions for the 
appointment and compensation of two As- 
sistant Secretaries of Agriculture and an Ad- 



ministrative Assistant Secretary of Agricul- 
ture. The rate of compensation fixed for 
these officers is that which I have found to 
prevail in respect of comparable officers in 
the Executive Branch of the Government. 

The taking effect of the reorganizations in- 
cluded in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 4 of 1950 is printed in 
House Document 508 (8ist Cong., 2d sess.). It 
did not become effective. 



59 Special Message to the Congress Transmitting Reorganization 
Plan 5 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 5 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and pro- 



viding for reorganizations in the Depart- 
ment of Commerce. My reasons for 
transmitting this plan are stated in an ac- 
companying general message. 



205 



[59] Mar. 13 



Public Papers of the Presidents 



After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 5 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of 
the Reorganization Act of 1949. 

I have found and hereby declare that it 
is necessary to include in the accompanying 
reorganization plan, by reason of reorgani- 
zations made thereby, provisions for the ap- 
pointment and compensation of an Admin- 
istrative Assistant Secretary of Commerce. 
The rate of compensation fixed for this of- 
ficer is that which I have found to prevail 
in respect of comparable officers in the Ex- 
ecutive Branch of the Government. 



The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. How- 
ever, many benefits in improved operations 
are probable during the next years which 
will result in a reduction in expenditures as 
compared with those that would be other- 
wise necessary. An itemization of these re- 
ductions in advance of actual experience 
under this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 5 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1263) and 
in the 1 949-1 953 Compilation of title 3 of the 
Code of Federal Regulations (p. 1004). It became 
effective on May 24, 1950. 



60 Special Message to the Congress Transmitting Reorganization 
Plan 6 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 6 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and pro- 
viding for reorganizations in the Department 
of Labor. My reasons for transmitting this 
plan are stated in an accompanying general 
message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. 6 of 1950 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the Re- 
organization Act of 1949. 

I have found and hereby declare that it 
is necessary to include in the accompanying 
reorganization plan, by reason of reorganiza- 
tions made thereby, provisions for the ap- 
pointment and compensation of an Admin- 
istrative Assistant Secretary of Labor. The 



rate of compensation fixed for this officer is 
that which I have found to prevail in respect 
of comparable officers in the Executive 
Branch of the Government. 

The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. How- 
ever, many benefits in improved operations 
are probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 6 of 1950 is published in 
the U.S. Statutes at Large (64 Stat. 1263) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1004). It became effec- 
tive on May 24, 1950. 



206 



Harry S. Truman, ig^o 



Mar. 13 [63] 



61 Special Message to the Congress Transmitting Reorganization 
Plan 7 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 7 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Interstate 
Commerce Commission. My reasons for 
transmitting this plan are stated in an ac- 
companying general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 7 of 1950 
is necessary to accomplish one or more of 
the purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 



The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 7 of 1950 is printed in 
House Document 511 (81 st Cong., 2d sess.). It did 
not become effective. 



62 Special Message to the Congress Transmitting Reorganization 
Plan 8 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 8 of 195O5 prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Federal Trade 
Commission. My reasons for transmitting 
this plan are stated in an accompanying 
general message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. 8 of 1950 is nec- 
essary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

The taking effect of the reorganizations 



included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 8 of 1950 is published in 
the U.S. Statutes at Large (64 Stat. 1264) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1005). It became effec- 
tive on May 24, 1950. 



63 Special Message to the Congress Transmitting Reorganization 
Plan 9 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 9 of 1950, prepared in accordance with 



the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Federal Power 
Commission. My reasons for transmitting 



207 



[63] Mar. 13 



Public Papers of the Presidents 



this plan are stated in an accompanying 
general message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. 9 of 1950 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 



probable during the next years v^hich will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 9 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1265) and in 
the 1 949-1 953 Compilation of tide 3 of the Code of 
Federal Regulations (p. 1005). It became effective 
on May 24, 1950. 



64 Special Message to the Congress Transmitting Reorganization 
Plan 10 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 10 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and pro- 
viding for reorganizations in the Securities 
and Exchange Commission. My reasons for 
transmitting this plan are stated in an ac- 
companying general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 10 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 
The taking effect of the reorganizations 



included in this plan may not in itself result 
in substantial immediate savings. How- 
ever, many benefits in improved operations 
are probable during the next years which 
will result in a reduction in expenditures as 
compared with those that would be other- 
wise necessary. An itemization of these 
reductions in advance of actual experience 
under this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 10 o£ 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1265) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1006). It became ef- 
fective on May 24, 1950. 



65 Special Message to the Congress Transmitting Reorganization 
Plan II of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. II of 1950, prepared in accordance with 
the Reorganization Act of 1949 and pro- 
viding for reorganizations in the Federal 
Communications Commission. My reasons 
for transmitting this plan are stated in an ac- 
companying general message. 



After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 11 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of 
the Reorganization Act of 1949. 

The taking effect of the reorganizations 
included in this plan may not in itself result 



208 



Harry S. Truman, ig^o 



Mar. 13 [67] 



in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 



tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 11 of 1950 is printed in 
House Document 515 (8ist Cong., 2d sess.). It 
did not become effective. 



66 Special Message to the Congress Transmitting Reorganization 
Plan 12 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 12 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the National Labor 
Relations Board. My reasons for transmit- 
ting this plan are stated in an accompanying 
general message. 

After investigation I have found and here- 
by declare that each reorganization included 
in Reorganization Plan No. 12 of 1950 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 



The taking effect of the reorganizations 
included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 12 of 1950 is printed in 
House Document 516 (8ist Cong., 2d sess.). It did 
not become effective. 



6j Special Message to the Congress Transmitting Reorganization 
Plan 13 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 13 of 1950, prepared in accordance with 
the Reorganization Act of 1949 and provid- 
ing for reorganizations in the Civil Aero- 
nautics Board. My reasons for transmitting 
this plan are stated in an accompanying 
general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 13 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of 
the Reorganization Act of 1949. 
The taking effect of the reorganizations 



included in this plan may not in itself result 
in substantial immediate savings. However, 
many benefits in improved operations are 
probable during the next years which will 
result in a reduction in expenditures as com- 
pared with those that would be otherwise 
necessary. An itemization of these reduc- 
tions in advance of actual experience under 
this plan is not practicable. 

Harry S. Truman 

note: Reorganization Plan 13 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1266) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1006). It became effec- 
tive on May 24, 1950. 



209 



[68] Mar. 13 



Public Papers of the Presidents 



68 Special Message to the Congress Transmitting Reorganization 
Plan 14 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 14 of 1950, prepared in accordance with 
the provisions of the Reorganization Act of 
1949. For the purpose of coordinating the 
administration of labor standards under vari- 
ous statutes relating to Federal construction 
and public works or to construction with 
Federally financed assistance or guarantees, 
the reorganization plan authorizes the Sec- 
retary of Labor to prescribe appropriate 
standards, regulations and procedures with 
respect to these matters and to make such 
investigations concerning compliance with 
and enforcement of labor standards as he 
deems desirable. The purpose is to assure 
consistent and eflfective enforcement of such 
standards. 

The plan is in general accord with the 
recommendations of the Commission on 
Organization of the Executive Branch of the 
Government. It constitutes a further step in 
rebuilding and strengthening the Depart- 
ment of Labor to make it the central agency 
of the Government for dealing with labor 
problems. 

After investigation, I have found and 
hereby declare that the reorganization con- 
tained in this plan is necessary to accomplish 
one or more of the purposes set forth in sec- 
tion 2(a) of the Reorganization Act of 1949. 

There are several laws regulating wages 
and hours of workers employed on Federal 
contracts for public works or construction. 
The "Eight Hour Laws" limit the employ- 
ment of laborers and mechanics on such proj- 
ects to eight hours per day and permit their 
employment in excess of that limit only upon 
condition that time and one-half the basic 
wage rate is paid for the excess hours. The 
Davis-Bacon Act provides that the minimum 



rates of pay for laborers and mechanics on 
certain Federal public works contracts shall 
be those prevailing for the corresponding 
classes of workers in the locality as deter- 
mined by the Secretary of Labor. The 
Copeland Anti-Kickback Law prohibits the 
exaction of rebates or kickbacks from work- 
ers employed on the construction of Federal 
public works or works financed by the Fed- 
eral Government and authorizes the Secre- 
tary of Labor to make regulations for con- 
tractors engaged on such projects. 

In addition to the above statutes, there are 
several Acts which require the payment of 
prevailing wage rates, as determined by the 
Secretary of Labor, to laborers and mechanics 
employed on construction financed in whole 
or in part by loans or grants from the Fed- 
eral Government or by mortgages guaran- 
teed by the Federal Government. These 
Acts are: The National Housing Act, the 
Housing Act of 1949, the Federal Airport 
Act, and the Hospital Survey and Construc- 
tion Act of 1946. 

With the exception of the Department of 
Labor, the Federal agencies involved in the 
administration of the various Acts are di- 
vided into two classes: (i) agencies which 
contract for Federal public works or con- 
struction; and (2) agencies which lend or 
grant Federal funds, or act as guarantors of 
mortgages, to aid in the construction of proj- 
ects to be built by State or local public 
agencies or private individuals and groups. 
The methods of enforcing labor standards 
necessarily differ between these two groups 
of agencies. 

The methods adopted by the various 
agencies for the enforcement of labor stand- 
ards vary widely in character and effective- 
ness. As a result, uniformity of enforce- 



210 



Harry S. Truman, ig^o 



Mar. 13 [69] 



ment is lacking and the degree of protection 
afforded workers varies from agency to 
agency. 

In order to correct this situation, this plan 
authorizes the Secretary of Labor to co- 
ordinate the administration of legislation re- 
lating to wages and hours on Federally fi- 
nanced or assisted projects by prescribing 
standards, regulations, and procedures to 
govern the enforcement activities of the 
various Federal agencies and by making such 
investigations as he deems desirable to as- 
sure consistent enforcement. The actual 
performance of enforcement activities, 
normally including the investigation of 



complaints of violations, will remain the 
duty of the respective agencies awarding the 
contracts or providing the Federal assistance. 
Since the principal objective of the plan 
is more effective enforcement of labor stand- 
ards, it is not probable that it will result in 
savings. But it will provide more uniform 
and more adequate protection for workers 
through the expenditures made for the en- 
forcement of the existing legislation. 

Harry S. Truman 

note: Reorganization Plan 14 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1267) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1007). It became ef- 
fective on May 24, 1950. 



69 Special Message to the Congress Transmitting Reorganization 
Plans 15, 165 and 17 of 1950. March 13, 1950 



To the Congress of the United States: 

I am transmitting today Reorganization 
Plans Nos. 15, 16, and 17 of 1950, prepared 
in accordance with the provisions of the Re- 
organization Act of 1949. The three plans 
transfer various activities of the General 
Services Administration to other departments 
and agencies as follov^s: Plan No. 15 assigns 
the administration of the Alaska and Virgin 
Islands public w^orks programs to the Depart- 
ment of the Interior; Plan No. 16 transfers 
the responsibility for financial assistance to 
public school districts and grants and loans 
for water pollution control to the Federal 
Security Agency; and Plan No. 17 transfers 
the administration of advances for the plan- 
ning of non-Federal public works and the 
management and disposal of certain war 
public works to the Housing and Home 
Finance Agency. 

These plans will contribute to the further 
development of the General Services Ad- 
ministration as a central services agency by 
transferring several specialized functions, 



which it has at present, to more appropriate 
locations within the Government. At the 
same time Reorganization Plans No. 18 and 
20, which I am also transmitting to the Con- 
gress today, assign to the Administration 
additional responsibility for such services as 
the control of space in public buildings and 
the publication and preservation of various 
public documents. 

The General Services Administration was 
created by the Federal Property and Ad- 
ministrative Services Act of 1949 to provide 
a focal point within the Executive Branch 
for the provision and improvement of such 
common administrative services as supply, 
buildings administration and records man- 
agement. The act sought to achieve this 
objective by consolidating in the new Ad- 
ministration a group of service activities 
which had previously been scattered through- 
out the Executive Branch. 

Many of these service activities at the time 
the act was passed were being performed by 
the Federal Works Agency. At the same 



211 



[69] Mar. 13 



Public Papers of the Presidents 



time the Federal Works Agency was per- 
forming certain specialized functions not of 
interest to the government as a whole. 
When the Congress transferred all the func- 
tions of the Federal Works Agency to the 
General Services Administration it was rec- 
ognized that these specialized functions 
should be separated out at a later date by re- 
organization action. Only if this is done 
will the General Services Administration be 
able to fulfill its basic function and concen- 
trate its efforts on the improvement of the 
vast and complex service activities of the 
Federal Government. 

The transfers effected by these plans are 
consistent with the recommendations of the 
Commission on Organization of the Execu- 
tive Branch of the Government. The pro- 
grams which involve direct Federal construc- 
tion are transferred to the Department of the 
Interior. The programs involving grants or 
loans to states and localities are transferred 
to the departments and agencies having 
major responsibility for these particular 
activities. 

This general message states my reasons for 
transmitting Reorganization Plans Nos. 15, 
16, and 17. The legal findings as to neces- 
sity and savings required by the Reorganiza- 
tion Act of 1949 are included in separate 
messages transmitting each of the three plans. 

REORGANIZATION PLAN NO. 15 

(Alaska and Virgin Islands Public Works) 

Reorganization Plan No. 15 transfers the 
responsibilities of the General Services Ad- 
ministrator for public works programs in 
Alaska and the Virgin Islands to the Secre- 
tary of the Interior in order that the direction 
of these activities may be assumed by the De- 
partment generally charged with the de- 
velopment and welfare of Alaska and the 
Virgin Islands. The Alaska public works 



program is very new, having been authorized 
by Public Law 264 of the 8ist Congress. 
This Act empowers the General Services Ad- 
ministrator, with the concurrence of the 
Secretary of the Interior, to build community 
facilities for public bodies in the Territory 
for an average purchase price of one-half of 
the estimated cost of construction. The Vir- 
gin Islands program is much smaller and has 
been in effect since the approval on Decem- 
ber 20, 1944, of Public Law 510, 78th Con- 
gress. Under the provisions of this Act, the 
General Services Administrator builds 
various public facilities authorized by the 
legislation. 

Both the Alaska and the Virgin Islands 
programs involve the direct provision of 
assistance to eligible public bodies. Both 
projects involve construction by the Federal 
Government of approved facilities, which 
upon completion are turned over to the local 
authorities for which they were built. These 
responsibilities are thus largely unrelated to 
the administrative services with which the 
General Services Administration is primarily 
concerned. 

The Department of the Interior is already 
charged with the supervision of public works 
units in the Caribbean area and in Alaska. 
Chief among these are the Alaska Road 
Commission and the Puerto Rico Recon- 
struction Administration. Moreover, the 
operations of the Alaska Railroad and the 
Virgin Islands Corporation are under the 
supervision of the Department. Also of 
importance in the administration of these 
public works programs are the close rela- 
tionships which exist between the Depart- 
ment of the Interior and the governors of 
Alaska and the Virgin Islands. These oflS- 
cials are appointed by the President, but they 
normally report through the Secretary of the 
Interior. The transfer will thus clarify re- 
sponsibility and simplify relationships in the 



212 



Harry S. Truman, ig^o 



Mar. 13 [69] 



execution of public works activities in 
Alaska and the Virgin Islands. 

REORGANIZATION PLAN NO. 1 6 

(Assistance to School Districts and Water 
Pollution Control) 

Reorganization Plan No. i6 transfers the 
school assistance and water pollution control 
activities of the General Services Adminis- 
tration to the Federal Security Agency. 

The rendering of assistance to local school 
districts overburdened by the activation of 
Federal projects or installations was first 
authorized by the Lanham Act of 1940, as 
amended. Since the expiration of the Lan- 
ham Act there have been four one-year ex- 
tensions of the program. The plan will 
place the responsibility for its future admin- 
istration in the Federal Security Agency, 
whose Office of Education is generally re- 
sponsible for the execution of Federal-aid 
programs designed to improve or extend 
educational opportunities. 

Reorganization Plan No. 16 also consoli- 
dates responsibility for the administration of 
the Water Pollution Control Act of 1948 in 
the Federal Security Agency by transferring 
to it the functions of the General Services 
Administration relating to grants and loans 
for the planning and construction of sewage 
treatment plants. 

At the present time over 90 percent of the 
administration of the water pollution con- 
trol activities authorized by Public Law 845, 
8oth Congress, is carried on by the Public 
Health Service of the Federal Security 
Agency. That agency is already responsible 
for the preparation of comprehensive water 
pollution control plans for interstate streams, 
for the conduct of surveys and research, for 
the maintenance of relationships with state 
water pollution control agencies, and for the 
approval of sewage treatment projects for 



which grants or loans are requested by state 
or local authorities. The effect of the plan 
will be to place the entire responsibility for 
the approval and administration of the grant 
and loan provisions of the Water Pollution 
Control Act in the Federal Security Agency, 
as the agency with the predominant interest 
in the attainment of the objectives of the 
legislation. 

The consolidation of water pollution con- 
trol functions will simplify relationships with 
the state and local governments participating 
in the program. Under the existing arrange- 
ments two Federal agencies must take part 
in the review and approval of each request 
for a grant or loan. The Reorganization 
Plan will make it possible for applicants to 
look exclusively to the river basin offices of 
the Public Health Service in seeking infor- 
mation or assistance in the abatement of 
water pollution. 

REORGANIZATION PLAN NO. 17 

(Advance Planning and War Public Works) 

Reorganization Plan No. 17 transfers two 
of the programs of the General Services 
Administration to the Housing and Home 
Finance Agency. The first of these involves 
the administration of advances to state and 
local governments for the planning of public 
works. This transfer is consistent with 
recent action of the Congress which has 
given the Housing and Home Finance 
Agency an important function in the orderly 
planning and development of the public 
facilities and physical characteristics of 
American communities. 

The advance planning of non-Federal pub- 
lic works was revived as an activity of the 
Government of the United States by Public 
Law 352, approved October 13, 1949. ^^ 
authorizes repayable advances to state and 
local governments for the planning of a shelf 



213 



[69] Mar. 13 



Public Papers of the Presidents 



of public works available both for emergen- 
cies and to meet the growing needs of com- 
munities. Within the limits of available 
funds, Federal aid is extended to any state 
or local government which applies for an 
advance if the proposed project conforms to 
the over-all plans approved by competent 
state, local or regional authorities, if the ap- 
plicant possesses the legal authority to pro- 
ceed with construction, and if the financial 
resources of the community are found to be 
adequate to make the undertaking feasible. 
Advances have been requested chiefly to aid 
in the planning of water and sewer systems, 
schools, urban streets and roads and miscel- 
laneous public buildings. Both the intent of 
the Act and the nature of the facilities 
planned require that the Federal agency ad- 
ministering Public Law 352 have an under- 
standing of how advance planning can con- 
tribute to community development. 

The Housing Act of 1949 assigned to the 
Housing and Home Finance Administrator 
the responsibility for executing the slum 
clearance and community development pro- 
visions of the statute. The adequate ad- 
ministration of this program requires that 
attention be directed to the planning of 
urban communities, including the various 
public facilities needed to assure the inte- 
grated development of project areas. The 
Housing and Home Finance Agency must 
maintain continuous liaison with local of- 
ficials, it must appraise accurately and thor- 
oughly the capacity of communities to fi- 
nance the projects authorized by the Hous- 
ing Act, and it must acquire a detailed 
knowledge of the legal authority of each par- 
ticipant to build various categories of public 
works. These are essentially the kinds of 
knowledge and relationships which are es- 
sential to the successful administration of 
advances for non-Federal public works. 

The consolidation of the responsibility for 
advance planning activities with slum clear- 



ance and urban redevelopment functions will 
make it possible to assure the integration of 
two programs which are not only closely re- 
lated in their objectives but now overlap to 
some extent. A single responsible agency 
will be able to assure that the authority under 
both statutes will be used to the maximum 
advantage of both the Federal Government 
and the state and local public bodies which 
seek to participate in the benefits. 

The plan will also make possible the unifi- 
cation of the administrative structure and 
field organization needed to administer the 
two programs. Moreover, the emergence 
of a single community development agency 
will make it possible for public bodies to 
deal with fewer Federal oflScials in the ad- 
vance planning of their public facilities, the 
elimination of blighted areas, and the pro- 
motion of well-balanced residential neigh- 
borhoods. The plan will consequently lead 
to improvements in one important sector 
of Federal-state and Federal-local relations. 

The second transfer provided for by 
Reorganization Plan No. 17 relates to the 
management and disposal of sewers, schools, 
hospitals and other community facilities con- 
structed under Title II of the Lanham Act 
of 1940, as amended. Its effect will be to 
consolidate these functions in the Housing 
and Home Finance Agency, which is al- 
ready responsible for over 95 percent of re- 
maining Lanham Act properties. The fact 
that approximately 30 percent of the war 
public works still in the possession of the 
General Services Administration are depend- 
ent upon war housing projects managed by 
the Housing and Home Finance Agency 
further illustrates the closeness of relation- 
ships between the current Lanham Act func- 
tions of the two agencies. 

An additional consideration in support of 
the transfer is the evolution of the Housing 
and Home Finance Agency as the unit of the 
Federal Government best prepared to nego- 



214 



Harry S. Truman, ig^o 



Mar. 13 [70] 



tiate with local officials on matters affecting 
a wide variety of community facilities — a 
preparedness which will be further enhanced 
by the transfer of advance planning func- 
tions. The reorganization plan will thus 
lead to improvements in the capacity of the 
Government to manage and dispose of the 
public facilities still in its possession in a 
manner which will simultaneously protect its 
interests and advance the development of 
the communities in which the projects are 
situated. 



The transfer of these programs to the 
agencies where they can be administered 
with other related activities will lead to the 



simplification of administrative arrange- 
ments, the reduction of unwarranted delays, 
and the curtailment of the duplication in- 
herent in divided responsibility. The re- 
sult will be greater ultimate benefits from 
the execution of the programs. These con- 
siderations, together with the beneficial ef- 
fect which the reorganizations will have on 
the General Services Administration, lead 
me to commend Reorganization Plans 15, 
16, and 17 to the Congress as important and 
constructive steps in our program of man- 
agement reform in the Executive Branch. 

Harry S. Truman 

note: For further messages on Reorganization Plans 
15, 16, and 17, see Items 70-72. 



70 Special Message to the Congress Transmitting Reorganization 
Plan 15 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 15 of 1950, prepared in accordance with 
the Reorganization Act of 1949. The plan 
transfers the functions of the General Serv- 
ices Administration relating to public works 
in Alaska and in the Virgin Islands to the 
Department of the Interior. My reasons for 
transmitting this plan are stated in an ac- 
companying general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 15 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

The savings to be realized from the trans- 
fers provided for in the plan cannot be pre- 
dicted in detail at this time. The small size 
and restricted character of the Virgin Islands 
public works program will prevent large re- 
ductions in administrative expenditures. 
However, by placing the responsibility for 



the activity in the department generally con- 
cerned with the government and welfare of 
the Islands, the plan will lead to a closer 
integration of the public works program 
with verified needs. 

The Alaska public works program is new 
and will continue to grow for some time. 
As a result the overall costs of administration 
will increase under any organizational ar- 
rangements which may be established. The 
concentration of responsibility in the Depart- 
ment already charged with the execution of 
related programs in Alaska and required by 
law to approve all projects constructed under 
the Alaska Public Works Act of 1949 should, 
however, simplify relationships and lead to 
more economical administration than would 
otherwise be possible. 

Harry S. Truman 

note: Reorganization Plan 15 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1267) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1007). It became ef- 
fective on May 24, 1950. 



215 



[7i] Mar. 13 



Public Papers of the Presidents 



71 Special Message to the Congress Transmitting Reorganization 
Plan 16 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 16 of 1950, prepared in accordance with 
the Reorganization Act of 1949. The plan 
transfers to the Federal Security Agency the 
functions of the General Services Adminis- 
tration relating to assistance to local school 
districts and grants and loans for water pollu- 
tion control projects. My reasons for trans- 
mitting this plan are stated in an accompany- 
ing general message. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 16 of 
1950 is necessary to accomplish one or more 
of the purposes set forth in section 2(a) of 
the Reorganization Act of 1949. 

The transfer of the responsibility for mak- 
ing payments to local school districts whose 
operating deficits are due in part to Federal 
activities is unlikely to result in an immediate 
reduction in expenditures for the administra- 
tion of the program. However, by placing 
the function in the agency of the Govern- 



ment best informed in matters of public 
school administration and presendy charged 
with the payment of other grants for educa- 
tional purposes, the plan will provide addi- 
tional assurance that the funds appropriated 
for assistance to overburdened school dis- 
tricts will be most advantageously expended. 
The relative newness and expanding char- 
acter of the water pollution control program 
prevents the itemization of the reductions in 
expenditures which will follow the consolida- 
tion of responsibility for this activity. It is 
expected that the elimination of overlapping 
and the simplification of relationships which 
will result from the transfer will make it 
possible to administer grants and loans more 
expeditiously and at lower costs per project 
than can be done under the present division 
of responsibility. 

Harry S. Truman 

note: Reorganization Plan i6 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1268) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1008). It became ef- 
fective on May 24, 1950. 



72 Special Message to the Congress Transmitting Reorganization 
Plan 17 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 17 of 1950, prepared in accordance with 
the Reorganization Act of 1949. The plan 
transfers the functions of the General Serv- 
ices Administration relating to the advance 
planning of non-Federal public works and 
the management and disposal of certain war 
public works to the Housing and Home Fi- 
nance Agency. My reasons for transmitting 
this plan are stated in an accompanying 
general message. 



After investigation I have found and 
hereby declare that each reorganization in- 
cluded in Reorganization Plan No. 17 is 
necessary to accomplish one or more of the 
purposes set forth in section 2(a) of the 
Reorganization Act of 1949. 

The first of the transfers provided for by 
this plan will result in the more economical 
administration of those activities of the Fed- 
eral Government which are concerned with 
the over-all planning and development of 
communities. The concentration of respon- 



216 



Harry 5. Truman, ig^o 



Mar. 13 [73] 



sibility in a single agency will make it pos- 
sible to so integrate administration as to 
avoid duplication of technical staffs and to 
simplify relationships with state and local 
agencies. Moreover, by reducing the likeli- 
hood that the two programs involved will 
be administered at cross-purposes or in con- 
flict with each other, it can be expected that 
the money expended will achieve greater 
benefits than would be likely under the pres- 
ent distribution of responsibility. It is not, 
however, possible to itemize the reduction 
in expenditures which will result, chiefly 
because both programs are of recent origin 
and are still undergoing expansion. 

The transfer of the war public works func- 
tions will lead to modest savings by consoli- 



dating the responsibility for the management 
and disposal of all properties built or ac- 
quired under the Lanham Act of 1940, as 
amended, in the agency which already has 
the greater part of the total job. The fact 
that it will become possible to manage and 
dispose of public facilities serving emergency 
housing developments without the inter- 
agency negotiation which is now necessary 
will lead to economies, although they cannot 
be itemized or predicted with exactness. 

Harry S. Truman 

note: Reorganization Plan 17 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1269) and 
in the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1008). It became ef- 
fective on May 24, 1950. 



73 Special Message to the Congress Transmitting Reorganization 
Plan 18 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 18 of 1950, prepared in accordance with 
the provisions of the Reorganization Act of 
1949. The plan transfers to the Administra- 
tor of General Services the functions of the 
various Federal agencies with respect to 
leasing and assigning general purpose space 
in buildings and the operation, maintenance 
and custody of office buildings. Since such 
authority is already largely concentrated in 
the General Services Administration with 
respect to the District of Columbia, the plan 
principally relates to the administration of 
these functions in the field. 

The transfers made by this plan will pro- 
mote more economical leasing, better utiliza- 
tion of building space, and more efficient 
operation of Government-controlled office 
buildings. They will effectuate the recom- 
mendations of the Commission on Organi- 
zation of the Executive Branch of the Gov- 
ernment with respect to concentrating in 



the General Services Administration the re- 
sponsibility for space allotment and the op- 
eration of Government buildings outside of 
the District of Columbia. Likewise, they 
will extend the principles laid down by the 
Congress in enacting the Federal Property 
and Administrative Services Act of 1949 to 
another important area of Government-wide 
administrative services — the administration 
of Government office buildings and general 
purpose building space in the field. 

Within the District of Columbia, one 
agency, the Public Buildings Service of the 
General Services Administration, has long 
had the operation and custody of most Gov- 
ernment buildings and the leasing and as- 
signment of space for executive agencies. 
Thus, nearly all requests for building space 
are handled by a single organization which 
is responsible for seeing that agencies are 
properly and efficiently housed. This ar- 
rangement has proved its worth and has 
repeatedly been approved by the Congress. 



41-355— G5- 



-17 



217 



[73] Mar. 13 



Public Papers of the Presidents 



Outside of the National Capital, however, 
responsibility for the acquisition and con- 
trol of building space and the operation of 
Government buildings is v^idely diffused. A 
variety of agencies operate and control gen- 
eral purpose buildings. If quarters are not 
available in Federal buildings, each agency 
ordinarily does its ov^n leasing. As a result, 
in some cases Federal agencies have con- 
tracted for space at high rentals at the very 
time that other agencies have been giving up 
surplus low-cost space. 

The assignment of space in Government- 
owned buildings outside of Washington is 
also divided among a number of agencies. 
While the Public Buildings Service con- 
structs a large part of the Government build- 
ings, it operates and controls the assignment 
of space in only a small proportion of them. 
The Post Office Department operates and 
allocates the space in post office buildings, 
several hundred of which contain substan- 
tial amounts of office space available for other 
agencies. During and immediately after the 
war several other Federal agencies acquired 
office buildings in the field. As their activi- 
ties have contracted, surplus space in many 
of these structures has become available for 
other uses. 

This plan concentrates in the General 
Services Administration the responsibility 
for the leasing and assignment of what is 
termed general purpose building space, that 
is, space which is suitable for the uses of 
a number of Federal agencies. It specifically 
excludes space in buildings at military posts, 
arsenals, navy yards, and similar defense 
installations and space in hospitals, labora- 
tories, factories and other special purpose 
buildings. 

Also, the plan excludes the Post Office 
Department from the transfer of leasing au- 
thority since the Department has a highly 
developed organization for this purpose, and 
it limits the transfer of space assignment 



authority in post office buildings to the space 
not occupied by the Department. Further, 
it gives the needs of the Post Office Depart- 
ment priority in the assignment of space in 
post office buildings. Thus, the plan amply 
safeguards the interests of the Post Office 
Department while making it possible to 
include the general office space in post office 
buildings in any given city with other simi- 
lar space under Federal control in planning 
and executing an efficient program for hous- 
ing Government agencies in that area. 

In addition, the plan transfers to the Gen- 
eral Services Administration the operation, 
maintenance, and custody of office buildings 
owned or leased by the Government, includ- 
ing those post office buildings which are not 
used predominandy for post office purposes. 
This will make it possible to establish a single 
organization for the operation and main- 
tenance of Government office buildings in 
principal cities in the field as has proved 
desirable in the National Capital. Since 
many post offices are in fact primarily large 
office buildings, the plan includes in this 
transfer the post office buildings which are 
not used predominantly for post office pur- 
poses. This will relieve the Post Office De- 
partment of a considerable expenditure for 
building operation and maintenance which 
properly should not be charged against postal 
revenues. 

While the plan effects a broad transfer of 
functions with respect to leasing and assign- 
ment of space and the operation and main- 
tenance of office buildings, it specifically 
authorizes the Administrator of General 
Services to delegate the performance of any 
part of these functions to other agencies 
subject to such regulations as he deems de- 
sirable for economical and effective admin- 
istration. In this the plan follows the pattern 
adopted by the Federal Property and Ad- 
ministrative Services Act of 1949 ^^^ other 
branches of property management. In large 



218 



Harry S, Truman, ig^o 



Mar. 13 [74] 



urban centers where numerous Federal units 
are located unified administration of space 
activities by the General Services Adminis- 
tration will normally be advantageous. On 
the other hand, in the smaller communities it 
will no doubt be desirable to delegate the 
work back to the agencies directly affected, 
to be carried on under standards laid down 
by the Administrator of General Services. 
The plan provides ample flexibility for work- 
ing out the most effective administrative 
arrangement for each type of situation. 

The fundamental soundness and economy 
of centralized administration of building 
space have been amply demonstrated in the 
National Capital. By virtue of unified con- 
trol it has been possible since the war to ac- 
complish far-reaching changes which have 
consolidated agencies in much fewer loca- 
tions, released many of the rented buildings, 
and greatly reduced the cost of housing the 
Government establishment. Similar pro- 



cedures applied in the larger centers of field 
activity should produce substantial savings. 

After investigation, I have found and 
hereby declare, that each reorganization con- 
tained in this plan is necessary to accomplish 
one or more of the purposes set forth in sec- 
tion 2(a) of the Reorganization Act of 1949. 

While it is not possible at this time to cal- 
culate the reduction in expenditures which 
will result from this plan, it can safely be 
predicted that it will produce substantial sav- 
ings. I am confident that this reorganization 
plan will constitute a significant improve- 
ment in Federal business practice and will 
bring about an important increase in effi- 
ciency in housing Government agencies. 

Harry S. Truman 

note: Reorganization Plan 18 of 1950 is published in 
the U.S. Statutes at Large (64 Stat. 1270) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1009). It became ef- 
fective on July I, 1950. 



74 Special Message to the Congress Transmitting Reorganization 
Plan 19 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herewith Reorganization Plan 
No. 19 of 1950, prepared in accordance with 
the Reorganization Act of 1949. This re- 
organization plan carries out a specific 
recommendation of the Commission on Or- 
ganization of the Executive Branch of the 
Government by transferring from the Fed- 
eral Security Agency to the Department of 
Labor the Bureau of Employees' Compensa- 
tion and the Employees' Compensation Ap- 
peals Board and their functions. The 
functions of the Federal Security Adminis- 
trator with respect to employees' compensa- 
tion are also transferred by the plan. 

The reorganization plan is a further step 
in achieving the general objective of the 
Commission to strengthen the Department 



of Labor by bringing within it labor func- 
tions which over many years have been scat- 
tered throughout the Executive Branch. 

Last year by reorganization plan the Bu- 
reau of Employment Security was transferred 
to the Department of Labor. Today I am 
also transmitting Reorganization Plan No. 
19 which assigns to the Department of Labor 
the responsibility for prescribing and en- 
forcing standards, regulations, and pro- 
cedures in order to coordinate and assure 
consistent enforcement of labor standards 
legislation applying to Federally financed or 
assisted construction and public works. The 
accompanying reorganization plan will fur- 
ther consolidate allied programs of the Fed- 
eral Government pertaining to employees 
and employment. 



219 



[74] Mar. 13 



Public Papers of the Presidents 



The Bureau of Employees* Compensation 
administers programs which compensate 
workers and their dependents for death or 
disabling injuries suffered in the course of 
employment. These programs constitute 
the Federal Government's system of work- 
men's compensation and include the related 
functions of accident prevention and safety. 
Currently, there are four major groups of 
employees covered by this system, including 
2,000,000 Federal employees, 500,000 long- 
shoremen and harbor workers, 250,000 in- 
dustrial employees in the District of Colum- 
bia and an estimated 100,000 employees of 
private contractors located at overseas 
United States bases. In 1949 these groups 
of employees suffered over 200,000 injuries, 
of which 30,000 resulted in claims for com- 
pensation. 

The Employees' Compensation Appeals 
Board hears and finally decides appeals on 
claims of employees covered by the Fed- 
eral Employees' Compensation Act. Non- 
Federal employees take appeals arising from 
compensation claims directly to the District 
courts. 

This workmen's compensation system, 
which is designed to mitigate the hardships 
attendant upon the death or disabling in- 
juries of employees growing out of their 
employment, is clearly a labor function and 
is closely related to other programs of the 
Department of Labor. 

For many years the Department of Labor 
has taken leadership in promoting standards 
for workmen's compensation programs 
throughout the country. It is most appro- 
priate that the agency promoting high stand- 
ards for workmen's compensation programs 
throughout the several states should likewise 
administer the Federal Government's work- 
men's compensation programs. 

An accident prevention program is always 
a necessary adjunct of a workmen's com- 
pensation system. The Department of 



Labor has the primary responsibility in the 
Federal Government for developing and pro- 
moting programs for the prevention and 
elimination of industrial hazards. This 
activity is primarily carried out by the Bu- 
reau of Labor Standards through the estab- 
lishment of safety standards of general appli- 
cation throughout industry. This Bureau is 
also the focal point for making effective the 
Government's Nation-wide conferences on 
industrial safety. A related activity is the 
responsibility of the Wage and Hour and 
Public Contracts Divisions of the Depart- 
ment to enforce the safety provisions of the 
Walsh-Healey Public Contract Act with 
respect to working conditions on certain 
public contracts. 

The Secretary of Labor also has special 
responsibilities relating to safety for Federal 
employees, having served as Chairman of 
the Policy Board of the Interdepartmental 
Safety Council since its inception. The 
Bureau of Labor Standards has provided the 
necessary staff work for the Council, and 
has assisted the Secretary of Labor in carry- 
ing out his broad area of interest in Federal 
safety programs. 

An integral part of the Department's ac- 
tivities for effective programs of workmen's 
compensation and industrial safety has been 
the compilation of accident statistics by the 
Bureau of Labor Statistics. Effective admin- 
istration of workmen's compensation or 
safety standards requires the use of that 
Bureau's information on work injuries and 
accident causes, for this information affords 
important guidance in the establishment of 
equitable compensation benefits and in the 
formulation of effective safety standards. 

Prior to 19 16, the Federal system of work- 
men's compensation was carried out under 
the Secretary of Labor, or his predecessor 
the Secretary of Commerce and Labor. 
From 19 16 to 1946 administration of this 
system was vested in an independent Em- 



220 



Harry S. Truman, ig^o 



Mar. 13 [75] 



ployees' Compensation Commission. Due 
to the greatly increased complexity of the 
Federal Government, it was imperative that 
the independent status of that Commission 
be eliminated and that it be placed within 
one of the major constituents of the Execu- 
tive Branch. Therefore, in 1946, the Em- 
ployees' Compensation Commission was 
abolished and its functions were transferred 
to the Federal Security Agency. 

Since 1946, new conditions have arisen 
which make it desirable to change the loca- 
tion of the Federal workmen's compensation 
system. Recently, through the 1949 amend- 
ments to the Federal Employees' Compensa- 
tion Act, the Bureau of Employees' Compen- 
sation was given increased responsibilities, 
with respect to accident prevention and 
safety. Furthermore, in 1949, responsibility 
for unemployment compensation was as- 
signed to the Department of Labor. Work- 
men's compensation, like unemployment 
compensation, is a program designed to al- 
leviate hazards arising in employment. 
Since functions relating to both employment 
and employment conditions are performed 
by the Department of Labor, compensation 
for injury suffered in employment, like com- 
pensation for unemployment, should also be 
a function of the Department of Labor. 

There are not transferred by the provisions 
of this reorganization plan (i) any function 
of the Public Health Service, (2) any func- 
tion of the Federal Security Agency or the 
Federal Security Administrator under the 



Vocational Rehabilitation Act, as amended 
(including the function of assuring the de- 
velopment and accomplishment of state re- 
habilitation plans affecting beneficiaries 
under the Federal Employees Compensation 
Act), nor (3) the function of developing or 
establishing rehabilitation services or fa- 
cilities. These responsibilities are retained 
in the Federal Security Agency. This pro- 
vision will preclude the necessity for estab- 
lishing any duplicating facilities or services. 

After investigation, I have found and 
hereby declare that each of the reorganiza- 
tions included in Reorganization Plan No. 19 
of 1950, is necessary to accomplish one or 
more of the purposes set forth in section 2(a) 
of the Reorganization Act of 1949. 

It is probable that a reduction of expendi- 
tures will result from the reorganizations in- 
cluded in this plan, as well as from greater 
efficiency of administration. An itemiza- 
tion of these reductions in advance of actual 
experience under this plan is not practicable. 

This reorganization is another link in the 
program to strengthen the Department of 
Labor. It will result in the accomplishment 
of optimum efficiency and is in the interest 
of the most effective organization of the 
Government. 

Harry S. Truman 

note: Reorganization Plan 19 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1271) and in 
the 1949-1953 Compilation of title 3 of the Code 
of Federal Regulations (p. 10 10). It became ef- 
fective on May 24, 1950. 



75 Special Message to the Congress Transmitting Reorganization 
Plan 20 of 1950. March 13, 1950 



To the Congress of the United States: 

I transmit herew^ith Reorganization Plan 
No. 20 of 1950, prepared in accordance with 
the provisions of the Reorganization Act of 
1949. This plan transfers from the Secretary 
of State to the Administrator of General 



Services a number of functions w^hich have 
no connection w^ith foreign affairs but bear 
a close relation to the archival and records 
functions of the General Services Adminis- 
tration. 
Since its establishment in 1789 the De- 



221 



[75] Mar. 13 



Public Papers of the Presidents 



partment of State has performed certain 
routine secretarial and record-keeping func- 
tions for the Federal Government which are 
entirely extraneous to its basic mission with 
respect to the conduct of foreign relations. 
While these activities do not properly belong 
in the Department, they were assigned to it 
and continued under its jurisdiction for want 
of an appropriate agency for their perform- 
ance. At present these functions consist of 
the preservation and publication of laws, the 
preparation and publication of the Statutes 
at large, the certification and publication of 
Constitutional amendments, the receipt and 
preservation of certificates of Presidential 
Electors and of electoral votes, and the com- 
pilation and publication of Territorial papers. 
Through The National Archives and Rec- 
ords Service the General Services Adminis- 
tration is especially staffed and equipped for 
the conduct of activities of these types. It is 
the principal custodian of the official records 
of the Government. Under the Federal 
Register Act and the Administrative Pro- 
cedure Act, it preserves and publishes in the 
Federal Register the executive orders, procla- 
mations, and other principal executive docu- 
ments and it codifies and publishes the rules 
and regulations promulgated by the various 
departments and agencies. This work is 
generally similar in nature to, and much 
greater in volume than, that performed by 
the Department of State with respect to Con- 
stitutional amendments, laws, and proclama- 
tions. Consequently, the consolidation of 
these activities of the State Department with 
the archival and records activities of the Gen- 
eral Services Administration should make 
for greater efEciency and economy. The 
plan, however, does not transfer the custody 
and publication of treaties and international 
agreements since they are matters of special 
concern to the Department of State and it is 
the agency most competent to edit such 
documents. 



The handling of the certificates of Presi- 
dential Electors and the compilation and 
publication of Territorial papers also more 
appropriately belong in the General Services 
Administration. The first is largely a mat- 
ter of record-keeping and the second of 
archival research. The preparation of the 
Territorial papers involves the compilation 
and editing of official documents of the vari- 
ous Territories formerly existing within the 
United States. The greater part of this ma- 
terial is now in the National Archives and 
the work involved is generally similar to 
that being performed by it with respect to 
other groups of public records. 

In addition, the plan abolishes two statu- 
tory duties of the Secretary of State which 
have become obsolete. The first is the duty 
of procuring copies of all State statutes as 
provided in the Act of September 23, 1789 
(R.S. 206). Inasmuch as the Library of 
Congress now has a complete collection of 
the State laws, it is no longer necessary for 
the Department of State to maintain a com- 
plete collection. The second is the require- 
ment, imposed by the Act of July 31, 1876 
(19 Stat. 105), as amended, that the Sec- 
retary of State publish proclamations and 
treaties in a newspaper in the District of Co- 
lumbia. This is now unnecessary since 
proclamations are published in the Federal 
Register and treaties are made available cur- 
rently in slip form in the Treaties and other 
International Acts Series. 

After investigation I have found and 
hereby declare that each reorganization in- 
cluded in this plan is necessary to accomplish 
one or more of the purposes set forth in 
section 2(a) of the Reorganization Act of 
1949. 

The transfers provided by this plan will 
relieve the State Department of a number of 
functions that have no relation to its primary 
purpose and place them in an agency espe- 



222 



Harry S. Truman, ig^o 



Mar. 13 [76] 



daily designed for the performance of such 
activities. Until these functions are incor- 
porated in the operations of the General 
Services Administration, it vv^ill not, of 
course, be practicable to determine the econ- 
omies attributable to their transfer, but it is 
reasonable to expect modest yet vv^orthv^hile 



savings to be achieved. 

Harry S. Truman 

note: Reorganization Plan 20 of 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1272) and 
in the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. loii). It became ef^ 
fective on May 24, 1950. 



76 Special Message to the Congress Transmitting Reorganization 
Plan 21 of 1950. March 13, 1950 



To the Congress of the United States: 

retransmit herevi^ith Reorganization Plan 
No. 21 of 1950, prepared in accordance with 
the provisions of the Reorganization Act of 
1949. This plan effects a basic reorganiza- 
tion of the functions of the United States 
Maritime Commission along the lines rec- 
ommended by the Commission on Organiza- 
tion of the Executive Branch of the Govern- 
ment. 

Within the last three years three different 
bodies have studied the administration of the 
Maritime Commission. All have concluded 
that the operating deficiencies of the agency 
arise from inappropriate and unsound orga- 
nization and that a fundamental reorganiza- 
tion is essential. The first of these bodies, 
the President's Advisory Committee on the 
Merchant Marine, in 1947, stated: "It ap- 
pears to the Committee that the organization 
structure of the Maritime Commission as 
set up in the Merchant Marine Act of 1936 
is wholly inadequate for the efficient conduct 
of the multitude of diverse activities for 
which the Maritime Commission is now 
responsible. The deficiencies of the statu- 
tory organization for administrative action 
are regarded by the Committee to be the 
most serious obstacle standing in the way of 
the development of the Merchant Marine of 
this country." Similarly, the survey of the 
Maritime Commission in 1948 for the Senate 
Conmiittee on Expenditures in the Executive 



Departments concluded that "The funda- 
mental weakness of the Maritime Commis- 
sion, as it is now constituted, lies in its 
prescribed organization." On the basis of in- 
vestigations of the Maritime Commission by 
two of its task forces, the Commission on 
Organization of the Executive Branch stated: 
"It is an anomaly that a regulatory commis- 
sion should also conduct the executive func- 
tion of managing a huge business; that ex- 
ecutive functions should be carried on by 
an agency that is not subject to presidential 
direction; that executive functions should be 
carried on by a full-time board ..." While 
the recommendations of the various studies 
differ in some details, they agree on prin- 
ciples and on the main features of reorgani- 
zation. 

Basically, the administrative difficulties of 
the Maritime Commission have arisen, as all 
these studies agree, from the fact that the 
Commission is responsible for performing 
two fundamentally different types of func- 
tions which call for different types of organi- 
zation. These two classes of functions are 
(a) regulatory and (b) operating and pro- 
motional. Under various acts the Commis- 
sion regulates rates and services of water 
carriers, passes on agreements among car- 
riers, and protects shippers against unfair 
and discriminatory practices. This type of 
activity requires the deliberation and inde- 
pendence of judgment which a board or 



223 



[y6] Mar. 13 



Public Papers of the Presidents 



commission is especially well designed to 
provide. But at the same time the G>mmis- 
sion is charged with the conduct of a variety 
of large and costly promotional and business- 
type programs demanding the prompt and 
vigorous administration for which experi- 
ence both in Government and in private 
enterprise has demonstrated that a single 
executive is essential. 

The Maritime Commission has charge of 
the construction of merchant vessels for sub- 
sidized operators and for government ac- 
count. It owns and maintains the largest 
merchant fleet in the world, consisting of 
2,200 vessels aggregating more than 22,000,- 
000 dead weight tons. It charters and sells 
ships and in time of war or national emer- 
gency requisitions and operates vessels for 
the Government. It grants construction and 
operating differential subsidies to private 
shipping companies to maintain an active 
privately operated American merchant 
marine. It makes loans and insures mort- 
gages to assist carriers in acquiring new 
vessels, and it conducts programs for train- 
ing officers and seamen for the merchant 
marine. For the present fiscal year the per- 
formance of these functions will involve the 
expenditure of approximately $162,000,000 
and the direction of an organization of 5,500 
employees. In short, the administration of 
the Maritime Commission is a vast business 
undertaking. Moreover, the work of the 
Commission affects significandy the interests 
of both business and labor in the mainte- 
nance of a sound maritime industry. 

Further than this, many of the activities 
of the Maritime Commission are closely re- 
lated to other programs of the Government 
and have to be coordinated with them. In 
the construction of a subsidized ship the 
Commission must cooperate with the Coast 
Guard on those features of design, materials, 
and equipment which affect the safety of the 
vessel and with the Navy on those which 



especially affect the use of the ship for na- 
tional defense. Furthermore, the whole pro- 
gram of subsidized ship construction needs 
to be adjusted to the plans and requirements 
for national defense. At the same time the 
Commission's programs for the development 
of the merchant marine must be coordinated 
with our foreign policy and with Federal 
programs with respect to other branches of 
transportation. 

While an independent commission is an 
appropriate instrument for the performance 
of the regulatory functions of the Maritime 
Commission, such an agency obviously is not 
the type required to provide strong and ef- 
ficient administration of the large operating 
programs now entrusted to the Commission 
or to obtain the needed coordination with 
other activities of the Executive Branch. 
This fact is amply demonstrated by the ad- 
ministrative difficulties and the complicated 
problems of coordination encountered in the 
operation of the Commission since the war 
and by the necessity of transferring a large 
part of its functions to the War Shipping 
Administration, headed by a single executive, 
during the war. 

Briefly, this reorganization plan provides 
for a small Federal Maritime Board and a 
Maritime Administration in the Department 
of Commerce to perform the functions of 
the Maritime Commission, and abolishes the 
existing Commission. It transfers to the 
Board the regulatory functions of the Com- 
mission and definitely guarantees the inde- 
pendence of the Board in the performance of 
these functions. In addition, it vests di- 
rectly in the Board the determination and 
award of construction and operating differ- 
ential subsidies. In the performance of its 
subsidy functions the Board will be subject 
to general policy guidance by the Secretary 
of Commerce. The Board, however, and it 
alone, will determine to whom subsidies shall 
be granted and will make and award the sub- 



224 



Harry S. Truman, ig$o 



Mar. 13 [76] 



sidy contracts. Its actions therein will be 
conclusive and will not be subject to modi- 
fication by any other agency or officer of the 
Department of Commerce. The other func- 
tions of the Maritime Commission, including 
carrying out the subsidy agreements made 
by the Board and administering the various 
operating programs, are transferred to the 
Secretary of Commerce for administration 
through the Maritime Administration. 
Thus, the plan provides for each of the two 
types of functions now vested in the Mari- 
time Commission the type of organization 
best suited to its performance. At the same 
time, the plan will facilitate coordination of 
maritime policies and programs with other 
related policies and programs. 

The division of functions under this plan 
conforms direcdy to the recommendations 
of the Commission on Organization of the 
Executive Branch of the Government. 
While the award of subsidies is a promo- 
tional rather than a regulatory function and 
might logically be assigned to the Maritime 
Administration instead of the Board, its 
impact on the shipping industry and on in- 
dividual carriers is such as to make desirable 
the deliberation and combined judgment 
of a board. Accordingly, I have adhered to 
the recommendation of the Commission on 
Organization that this function be vested 
in a multiple body rather than a single of- 
ficial. Likewise, in line with the recom- 
mendations of the Commission, the plan 
assigns the determination of the over-all 
route pattern to the Secretary of Commerce. 

The Maritime Board will consist of three 
members appointed by the President with 
the consent of the Senate for overlapping 
terms of four years. Not more than two of 
the members can be of the same political 
party. The Board, therefore, will be a 
smaller and more wieldy body which can 
function with greater expedition and effi- 
ciency than the existing five-member Com- 



mission. The Chairman will be designated 
by the President from the members of the 
Board and will be, ex officio, the Maritime 
Administrator and as such the head of the 
Maritime Administration. The plan also 
provides for a Deputy Maritime Admin- 
istrator appointed by the Secretary of Com- 
merce under the classified civil service. 
After investigation I have found, and hereby 
declare, that by reason of the reorganiza- 
tions made by this plan, it is necessary to 
include in the plan provisions for the ap- 
pointment and compensation of the members 
of the Federal Maritime Board and for the 
appointment of the Deputy Maritime Ad- 
ministrator. 

In making the Chairman of the Federal 
Maritime Board the Maritime Administra- 
tor, the plan adopts an arrangement sub- 
stantially similar to that which prevailed 
during the war, when the same individual 
served as Chairman of the Maritime Com- 
mission and head of the War Shipping Ad- 
ministration. This arrangement will have 
important advantages. It will facilitate co- 
operation between the Board and the Admin- 
istration of matters of concern to both. 
Also, it will avoid dividing the personnel of 
the Maritime Commission, since the Chair- 
man of the Board will supervise the person- 
nel assisting it in the performance of its 
functions, as is now the case in the Maritime 
Commission, and in his capacity as Admin- 
istrator he will have charge of the personnel 
carrying on the work of the Maritime Ad- 
ministration. The plan provides for the 
joint operation of the officers and employees 
under the Administrator and Chairman as 
a single body of personnel. The mainte- 
nance of a unified stafi is essential for ef- 
ficient and economical administration be- 
cause many of the technical and professional 
personnel, such as ship designers and at- 
torneys, now assist the Maritime Commis- 
sion on problems of subsidy determination 



41-355—65 -18 



225 



[y6] Mar. 13 



Public Papers of the Presidents 



and also participate in the subsequent admin- 
istration of subsidy agreements and in per- 
forming nonsubsidy functions. 

The inclusion of the new Board in the De- 
partment of Commerce will permit the use 
of the administrative services of the Depart- 
ment. More important, it will eliminate the 
necessity of splitting the personnel of the 
Maritime Commission between the Depart- 
ment and an outside agency. In addition, 
it will relieve the President of having to 
handle relations with a separate maritime 
agency. 

In establishing the Department of Com- 
merce the Congress provided in the Organic 
Act of the Department that "It shall be the 
province and duty of said Department to 
foster, promote, and develop the foreign and 
domestic commerce, . . . shipping, . . . and 
the transportation facilities of the United 
States." Over the years, however, trans- 
portation functions have become widely scat- 
tered throughout the Executive Branch. 
As a result, intelligent planning and budget- 
ing of Federal transportation activities 
and the necessary coordination of transporta- 
tion programs have become extremely diffi- 
cult or impossible. The transfer of the func- 
tions of the Maritime Commission to the 
Department of Commerce will constitute a 
major step in correcting this condition. 

Without question the Department of Com- 
merce is now the appropriate center for trans- 
portation programs. It contains the Civil 
Aeronautics Administration — the major op- 
erating and promotional agency of the Gov- 
ernment in the field of air transportation — 
and the Weather Bureau and the Coast and 
Geodetic Survey, which provide vital services 
to transportation. As a result of Reorganiza- 
tion Plan No. 7 of 1949, it now also includes 
the Bureau of Public Roads — the leading 
promotional agency dealing with land trans- 
portation. Also, it has the Inland Water- 



ways Corporation in the field of water trans- 
portation. The transfer of the functions of 
the Maritime Commission will bring into the 
Department the principal water transporta- 
tion agency of the Government. These 
actions will go a long way toward the estab- 
lishment of a sound and effective organiza- 
tion for the operating and promotional pro- 
grams of the Government relating to 
transportation. 

It is my purpose to look to the Secretary 
of Commerce for leadership with respect to 
transportation problems and for the develop- 
ment of over-all transportation policy within 
the Executive Branch. Because of the mag- 
nitude and importance of the transportation 
functions transferred to the Department of 
Commerce by this reorganization plan, I 
have found and hereby declare that it is 
necessary to strengthen the top administra- 
tive structure of the Department by provid- 
ing for the appointment and compensation 
of a new Under Secretary of Commerce for 
Transportation. This will make available 
an officer of the highest rank to assist the 
Secretary in supervising the varied and com- 
plex transportation programs of the Depart- 
ment and providing central leadership in 
transportation matters. With the many re- 
sponsibilities of the Secretary of Commerce 
in other areas, the creation of this office is 
essential to enable him properly to fulfill his 
obligations with respect to transportation. 

After careful investigation I have found 
and I hereby declare that each of the re- 
organizations contained in this reorganiza- 
tion plan is necessary to accomplish one or 
more of the purposes set forth in section 2(a) 
of the Reorganization Act of 1949. The 
rates of compensation fixed by the provisions 
of the reorganization plan for the Under 
Secretary of Commerce for Transportation, 
the Chairman and the other two members of 
the Federal Maritime Board are, respectively, 



226 



Harry S. Truman, ig^o 



Mar. 15 [77] 



those which I have found to prevail in respect 
of comparable officers in the Executive 
Branch of the Government. 

In summary, the reorganizations provided 
by this plan will have the following principal 
advantages: They will provide an efficient 
organization headed by a single responsible 
official to administer the large operating and 
business-type programs of the Maritime 
Commission. At the same time, they will 
preserve the benefits of a bi-partisan board 
for the performance of the regulatory func- 
tions of the Commission and the determina- 
tion of subsidies. They will reduce the 
number of agencies reporting directly to the 
President and simplify the over-all man- 
agement of the Executive Branch. In doing 
so, they will provide more adequate ma- 
chinery for supervising the administration 
of the maritime programs and will facilitate 



their coordination with related policies and 
programs of the Executive Branch. Finally, 
they will accomplish a major advance in the 
development of an effective organization of 
Federal transportation programs in accord 
with the recommendations of the Commis- 
sion on Organization of the Executive 
Branch of the Government. While it is im- 
possible to estimate in advance the savings 
which will be brought about by this plan, 
the improvements in administrative efficiency 
resulting from it should produce substantial 
reductions in expenditures for the programs 
transferred by the plan. 

Harry S. Truman 

note: Reorganization Plan 21 o£ 1950 is published 
in the U.S. Statutes at Large (64 Stat. 1273) and in 
the 1 949-1 953 Compilation of title 3 of the Code 
of Federal Regulations (p. 1012). It became ef- 
fective on May 24, 1950. 



77 Statement by the President on the National Capital 
Sesquicentennial Commission. March 15, 1950 



I HAVE examined reports on the progress 
made by the National Capital Sesquicenten- 
nial Commission and have been encouraged 
to note that many of the difficulties caused by 
the long delay in obtaining an appropriation 
for the work of the Commission are now 
being surmounted. Because of lack of funds, 
the Commission was faced with the difficult 
task of creating a celebration of major pro- 
portions in less than a third of the time 
usually available for such purposes. The 
Commission's work has now reached a point 
at which a number of its plans for a suitable 
observance of the sesquicentennial anniver- 
sary are ready for actual operation. 

It has been found necessary to postpone 
the Freedom Fair for a year. Certain legal 
questions must be settled, and a suitable site 
must be chosen, before a final decision can be 



reached on the eventual size and scope of the 
fair. I hope that all these problems will soon 
be resolved; for the Freedom Fair can, by 
its demonstration of the growth of our Na- 
tion under free enterprise, do much to show 
to the world the strength of our institutions. 

The remainder of the plans for the ob- 
servance of the 150th anniversary of the es- 
tablishment of the Federal Government in 
the city of Washington are well advanced. 
Collectively, they will provide a stimulating 
and interesting program, one which should 
attract many thousands of our citizens to 
Washington to join with us in the celebra- 
tion and help to give it the truly national 
character it should have. 

The work of the Commission deserves the 
full support of the citizens of Washington. 
I am sure that they will welcome this oppor- 



227 



[77] Mar. 15 



Public Papers of the Presidents 



tunity to manifest their faith in our govern- 
mental system, of which the city of Wash- 
ington is a noble symbol. 

note: On April 12, 1950, the President signed Proc- 
lamation 2881 "National Capital Sesquicentennial" 
(3 CFR, 1949-1953 Comp., p. 54). 



In a telegram dated May 10, 1950, Carter Barron, 
Executive Vice Chairman o£ the Sesquicentennial 
Commission, informed the President that the Com- 
mission's Executive Committee had decided to rec- 
ommend that the proposed Freedom Fair be 
abandoned. 



78 Letter to the Chairman, House Committee on Foreign 
Affairs, Urging Enactment of the Foreign 
Assistance Act. March 25, 1950 



My dear Mr, Chairman: 

I understand that the House of Repre- 
sentatives will soon consider the Foreign 
Assistance Act of 1950. I believe the Con- 
gress of the United States has an opportunity 
to strike a major blov^ for peace on behalf 
of people everywhere by taking rapid and 
favorable action on this legislation. 

Approval of this measure will give re- 
newed hope and vigor to people everywhere 
who are working to achieve their economic 
independence and maintain their political 
freedom. Passage of this Act will strengthen 
all nations threatened with intimidation, 
subversion, or direct aggression. 

It is in the interest of each American that 
there be a far greater measure of well-being 
in other lands. Other countries must be able 
to produce and procure from us and each 
other those things which will enable their 
people to have the food, health, and housing 
necessary to maintain economic and political 
stability. 

Poverty, misery, and insecurity are the con- 
ditions on which communism thrives. Free- 
dom-loving peoples can eliminate these con- 
ditions only by joining their knowledge and 
resources in a great cooperative effort. 

The Foreign Assistance Act will authorize 
continued economic aid to the Marshall Plan 
countries in Europe and to the Republic of 
Korea to enable them, through their own 
efforts, to establish self-supporting econo- 



mies. It will authorize aid where needed to 
those free countries in the general area of 
China whose survival is threatened by the 
imminent danger of communist infiltration. 
This Act will provide authority for a major 
effort to assist the peoples of southeast Asia. 

It will provide for participation in the 
United Nations effort to solve the serious 
problem of the Palestine refugees. Satis- 
factory solution of this problem is funda- 
mental to permanent peace in the Near East. 

The Act will authorize the carrying for- 
ward of the vital program of technical and 
other assistance to under-developed coun- 
tries which was the fourth point in my in- 
augural address. This will provide the 
peoples in under-developed areas of Asia, 
the middle East, and other parts of the world 
the hope and the tools they need to achieve 
and maintain real freedom for themselves. 

The program called for by this Act is the 
minimum consistent with the interest of the 
United States and our efforts to achieve a 
peaceful world. Failure to enact it in its full 
amount would do irreparable damage. We 
cannot live isolated in relative wealth and 
abundance. We cannot ignore the urgent 
problems of other peoples or threats to their 
independence. 

These measures are not acts of charity. 
Neither are they a waste of the resources of 
the United States. They are, indeed, the 
keystone of our protection against the de- 



228 



Harry S. Truman, i^^o 



Mar. 28 [79] 



struction of another war and against the 
terrible weapons of this atomic age. Our 
armed forces can afford us a measure of de- 
fense, but real security for our Nation and 
all the rest of mankind can come only from 
building the kind of world where men can 
live together in peace. 

The United States turned its back upon 
the rest of the world after the first world war. 
Some twenty years later, we found that we 
had to fight another world war. We cannot 
afford to follow that course again. We will 
save nothing if we ignore the needs of other 
nations now only to find that the result is 
World War III. 

Passage of this Act will enable us in com- 
pany with other nations to move a long step 



forward in our offensive for freedom and 
for peace. It will bring appreciably nearer 
the goal all freedom-loving peoples seek — 
a peace where all nations live in equality 
and mutual respect. It will be tangible evi- 
dence of our determination to achieve this 
kind of peace — evidence which will be 
understood by every nation in the world. 
Sincerely yours, 

Harry S. Truman 

[Honorable John Kee, Chairman, Committee on 
Foreign Affairs, House of Representatives, Wash- 
ington, D.C.] 

note: For the President's statement upon signing 
the Foreign Economic Assistance Act of 1950, see 
Item 154. 

The letter was released at Key West, Fla. 



79 Letters Regarding Disclosure of Confidential Files on 
Employee Loyalty. March 28, 1950 



Dear Senator Ty dings: 

This is in reply to your letter of March 22, 
1950, in which you have asked for the pro- 
duction before your Subcommittee of the 
investigative files relating to Government 
employees who are or have been employed 
in the Department of State and against 
whom charges of disloyalty have been made 
before your Subcommittee by Senator Mc- 
Carthy. The question raised by your re- 
quest is one of grave concern, and I have 
given very careful consideration to the re- 
sponse contained herein. 

In March of 1948, I issued a Directive to 
all officers and employees in the Executive 
Branch of the Government, directing that 
all reports, records, and files relating to the 
employee loyalty program be kept in strict 
confidence, even in instances where sub- 
poenas were received. As you know, this 
Directive was clearly within the power of 
the President, and I issued it only after the 
most careful consideration, and after I had 



satisfied myself beyond any doubt that any 
other decision would have resulted in the 
collapse of the loyalty program. 

At that time, I issued a release in which 
I pointed out the long-standing precedents 
regarding the production of confidential files 
and the reasons for my decision. I referred, 
among other things, to a letter from former 
Attorney General Robert H. Jackson, dated 
April 30, 194 1, to the Chairman of the House 
Committee on Naval Affairs, declining to 
furnish that Committee with certain reports 
of the Federal Bureau of Investigation, 
which letter was written with the approval 
and at the direction of President Roosevelt. 
That letter forcefully pointed out the serious 
consequences that would have resulted from 
compliance with the request of the House 
Naval Affairs Committee. 

Among other things, Attorney General 
Jackson stated: 

"Moreover, disclosure of the reports would 
be of serious prejudice to the future useful- 



229 



[79] Mar. 28 



Public Papers of the Presidents 



ness of the Federal Bureau of Investigation. 
As you probably know, much of this in- 
formation is given in confidence and can only 
be obtained upon pledge not to disclose its 
sources. A disclosure of the sources v^ould 
embarrass informants — sometimes in their 
employment, sometimes in their social rela- 
tions, and in extreme cases might even en- 
danger their lives. We regard the keeping 
of faith v^ith confidential informants as an 
indispensable condition of future efiSciency. 

"Disclosure of information contained in 
the reports might also be the grossest kind of 
injustice to innocent individuals. Investi- 
gative reports include leads and suspicions, 
and sometimes even the statements of ma- 
licious or misinformed people. 

"Even though later and more complete re- 
ports exonerate the individuals, the use of 
particular or selected reports might constitute 
the grossest injustice, and we all know that 
a correction never catches up with an ac- 
cusation." 

These three elements — the serious preju- 
dice to the effectiveness of the Federal Bu- 
reau of Investigation as an investigative 
agency, the resulting embarrassment and 
danger to confidential informants, and injus- 
tice and unfairness to innocent individuals — 
led me to the inescapable conclusion that the 
single most important element in an effective 
and at the same time just and fair loyalty pro- 
gram was the preservation of all files in 
connection therev^th in the strictest confi- 
dence. I cannot over-emphasize this point. 

During the last month, I have been re- 
examining with utmost care this entire prob- 
lem, and in this connection I have asked the 
Attorney General, the Director of the Federal 
Bureau of Investigation, and Mr. Seth Rich- 
ardson, Chairman of the Loyalty Review 
Board, to give their careful consideration to 
this matter. They have unanimously ad- 
vised me that disclosure of loyalty files would 
be contrary to the public interest, and would 



do much more harm than good. The Di- 
rector of the Federal Bureau of Investigation 
in a report to the Attorney General has out- 
lined the very serious consequences that 
would result from any such disclosure. The 
Director of the Federal Bureau of Investiga- 
tion stated: 

1. The public disclosure of F.B.I, reports 
will reveal investigative procedures and 
techniques. If publicized, criminals, foreign 
agents, subversives, and others would thus 
be forewarned and seek ways and means to 
carry out their activities, thus avoiding de- 
tection and hampering the efficiency of an 
investigative agency. The underground 
operations of criminals and subversives al- 
ready are most difficult of detection, and I do 
not believe the security of the Nation would 
be furthered by applying any additional 
shackles to the F.B.I. 

2. For the last 25 years, the F.B.I, has rep- 
resented to the American public that the 
F.B.I, would maintain their confidences. 
To make public F.B.I, reports would be to 
break confidences, and persons interviewed 
in the future might be even more reluctant 
to furnish information. In recent months, 
on numerous occasions, some citizens, shirk- 
ing their responsibilities, have refused to fur- 
nish information on the grounds that it 
might be misused, and have gone so far as to 
decline to furnish information, even in ap- 
plication investigations, claiming they would 
do so only if forced by a subpoena. 

3. A public disclosure of F.B.I, reports 
would reveal the identity of sources of in- 
formation, and in some cases, at least, would 
place in jeopardy the lives of confidential 
sources of information. 

4. Disclosure of information contained in 
F.B.I, reports might result in an injustice 
to innocent individuals, who find themselves 
entwined in a web of suspicious circum- 
stances, which can be explained only by 
further investigation, and disclosures might 



230 



Harry S. Truman, ig^o 



Mar. 28 [79] 



be made under circumstances which would 
deny the aggrieved the opportunity to pub- 
licly state their positions. 

5. A public disclosure could warn persons 
whose names appear in F.B.I, reports of the 
investigation, and serve as an effective means 
of enabling them to avoid detection, to ap- 
proach witnesses, to bring about the destruc- 
tion of evidence, or permit them to flee the 
country. 

6. Public disclosure of F.B.I, reports could 
contribute to blackmail of persons investi- 
gated, or could result in degrading persons 
who have made a mistake or fallen prey to 
false propaganda. 

7. Disclosure might reveal highly re- 
stricted information vital to the national se- 
curity and of considerable value to a foreign 
power. 

8. F.B.I, reports set forth full details se- 
cured from a witness, and if disclosed, could 
be subject to misinterpretation, quoting out 
of context, or used to thwart truth, distort 
half-truths, and misrepresent facts. 

It is my desire, however, that the charges 
of disloyalty made before your Subcommittee 
be given the most thorough and complete 
investigation, and it is my purpose to co- 
operate with your Subcommittee to the great- 
est extent possible, bearing in mind at all 
times my responsibility to take care that the 
investigative activities and efficiency of the 
Federal Bureau of Investigation and other 
investigative agencies remain unimpaired, 
that innocent people — ^both those under in- 
vestigation and those who have provided 
information — not be unnecessarily injured, 
and that the effectiveness of the employee 
loyalty program as a whole not be interfered 
with. 

I am, therefore, asking Mr. Seth Richard- 
son, Chairman of the Loyalty Review Board, 
to have the Board arrange for a complete 
and detailed review, as soon as possible, of 
the cases in which charges of disloyalty have 



been made before your Subcommittee (in- 
cluding cases heretofore reviewed by the 
Board), and am asking him to give me a 
full and complete report after review. 

This review will include reports of loyalty 
investigation made by the Federal Bureau 
of Investigation, and the files of the State 
Department and the Civil Service Commis- 
sion relating to these cases, as well as all 
other evidence of disloyalty made available 
to the Loyalty Review Board, including, of 
course, any evidence produced before your 
Subcommittee. 

Upon receipt of Mr. Richardson's report, 
I will advise your Subcommittee further. 

For your information, I am attaching 
hereto a list of the Members of the Loyalty 
Review Board. 

Sincerely yours, 

Harry S. Truman 

[Honorable Millard E. Tydings, United States Senate, 
Washington, D.C.] 

Dear Mr. Richardson: 

I am enclosing herewith a copy of a letter 
which I am sending to Senator Tydings, 
with reference to the investigation now being 
conducted by the Subcommittee of the Sen- 
ate Committee on Foreign Relations of 
Government employees who are or have been 
employed in the Department of State and 
against whom charges of disloyalty have been 
made. I believe the letter is self-explanatory. 

In accordance with the letter, I would ap- 
preciate it if the Loyalty Review Board 
would arrange for a complete and detailed 
review, as soon as possible, of the cases in 
which charges of disloyalty have been made 
before Senator Tyding's Subcommittee. 
This review should include cases which have 
heretofore been reviewed by the Board, and 
should include a review of reports of loyalty 
investigations made by the Federal Bureau 
of Investigation and files of the State Depart- 
ment and the Civil Service Commission re- 



231 



[79] Mar. 28 



Public Papers of the Presidents 



lating to such cases, as well as a review of all 
other evidence of disloyalty made available 
to you, including of course any evidence pro- 
duced before the Subcommittee. 

Would you please furnish me with a full 
and complete report after completion of the 
Board's review? 

Sincerely yours, 

Harry S. Truman 

[Honorable Seth W. Richardson, Chairnian, Loyalty 
Review Board, United States Civil Service Commis- 
sion, Washington, D.C.] 

note: Senator Tydings, in his letter to the President 
of March 22, requested that his committee be per- 
mitted to examine the files of the State Department, 
the Loyalty Board, and the FBI "as to vs^hat these 
files contain concerning nine persons named by 
Senator McCarthy in opening hearings and eighty 
persons named by number against whom charges of 
one kind or another were made by Senator McCarthy 
in a speech on the Senate floor on February 20, 
1950." 

For a further letter to Senator Tydings, dated 
April 3, again refusing to disclose confidential in- 
formation on employee loyalty, see Item 82. 



Senator Tydings' subcommittee report states that 
on May 4, "upon ascertaining that the cases with 
respect to the individuals named by Senator Mc- 
Carthy were identical with individuals whose loyalty 
files had previously been reviewed by four com- 
mittees of the Eightieth Congress, the President . . . 
agreed to make the loyalty files available for review 
by our subcommittee with respect to such individuals, 
on the theory that to do so would not establish a 
precedent for subsequent exceptions in violation of 
his March 13, 1948, directive" (Senate Report 2108, 
State Department Employee Loyalty Investigation, 
p. 9). The President's directive of March 13, 1948, 
is Item 50, 1948 volume, this series. 

On April 5, 1950, Seth Richardson, Chairman of 
the Loyalty Review Board, stated before the Tydings* 
subcommittee that "not one single case or evidence 
directing towards a case of espionage has been dis- 
closed in the record. ... I say it is an extraordinary 
thing that not one single syllable of evidence has been 
found by the FBI, efficient as they are, indicating 
that a particular case involves a question of es- 
pionage" (State Department Employee Loyalty In- 
vestigation, Hearings, subcommittee of the Com- 
mittee on Foreign Relations, Senate, 8ist Cong., 2d 
sess., pt. I, p. 409). 

The President's letters to Senator Tydings and 
Mr. Richardson were released at Key West, Fla. 



80 The President's News Conference at Key West. 
March 30, 1950 



THE PRESIDENT. I wiU answcf any questions 
I can, if you want to start in. 

[i.] Q. Mr. President, the New York 
Times this morning carried a story saying 
that you had suggested Secretary Acheson 
explore with Senator Vandenberg and other 
Republicans the possibility of appointing a 
Republican as Ambassador at Large to help 
out on bipartisan Asiatic policy. 

THE PRESIDENT. The matter has been 
discussed. 

Q. Are you nearing a decision on that, sir? 

THE PRESIDENT. Working on it. No de- 
cision as yet. 

Q. Have you got a nominee in mind, Mr. 
President.? 

THE PRESIDENT. No. No, I havcn't. Sev- 



eral under consideration. It is nothing 
unusual or new at all. The Republican 
members of the United Nations delegation 
and the same people who have been in on 
the foreign policy have always been con- 
sulted about the world policy. It is not an 
Asiatic policy or a European policy; it is a 
world policy. The foreign policy of the 
United States covers the whole globe, and 
always has ever since I have been President. 

Q. Well, Mr. President, is it an Ambassa- 
dor at Large on Asiatic policy or world 
policy.? 

THE PRESIDENT. World policy. The whole 
thing will be a world policy program. Am- 
bassador Jessup has been making a prelimi- 
nary survey in the Eastern Hemisphere on 



232 



Harry S. Truman, ig^o 



Mar. 30 [80] 



the subject. It is not confined to any one 
place. 

We are trying to implement the United 
Nations on the basis where it will work 
under the charter for the purpose for which 
it was intended, where all countries can meet 
and discuss their problems and come to 
agreement without having to feud each other 
over it. That is the object of the whole 
thing. World peace is what we are working 
for, and our policy hasn't changed, and our 
approach to it has never changed since I 
have been President. 

Q. Mr. President, would this particular 
position be similar to the one held by Mr. 
Jessup? He is an Ambassador at Large. 

THE PRESIDENT. That's right. It's just a 
part of the foreign policy team of the United 
States. And it's a bipartisan policy. That 
is what we have always endeavored to main- 
tain. It has been the same under every 
Secretary of State since Cordell Hull, who 
instituted it. 

[2.] Q. Mr. President, are you ready as 
yet to make any announcements regarding 
some of the reported appointments that are 
impending? 

THE PRESIDENT. When you get through 
asking questions on other subjects, I will 
talk to you about it. I don't want that 
fence broken down. [Laughter] 

[3.] Q. Could you comment, sir, on 
General Eisenhower's statement before the 
congressional committee? ^ 

THE PRESIDENT. The Statements of General 
Eisenhower before the congressional com- 
mittee were fundamentally in complete 
agreement with the policies which we have 



^Gen. Dwight D. Eisenhower appeared before 
the Senate Appropriations Subcommittee on March 
29, 1950. He testified that "several hundred mil- 
lions" of dollars probably should be added to Presi- 
dent Truman's military budget to strike a proper 
balance between the requirements of economy and 
security. 



pursued right along. No fundamental dif- 
ference between us. 

Q. What you have laid down in your con- 
ferences with the General? 

THE PRESIDENT. Yes — Well, in the Budget 
Message. And Eisenhower was in on the 
conferences that were held. General Ei- 
senhower, and General Marshall, and all 
those able and distinguished gentlemen — 
Admiral Nimitz — ^were consulted with re- 
gard to the budget and its program. And 
the General's testimony was in almost com- 
plete agreement with that arrangement. 

Q. Mr. President, do you agree with Gen- 
eral Eisenhower that our defenses are pos- 
sibly below the point of safety? 

THE PRESIDENT. No, I do UOt. I dou't 

think General Eisenhower intended to imply 
that. I have read his testimony. 

Q. I was thinking in terms of his speech 
Saturday night.^ 

THE PRESIDENT. Oh, Well, you kuow in 
making speeches you must remember that 
everybody has his ideas on public speaking, 
but the record before the Senate committee 
is what you have to go on. 

Q. Mr. President, yesterday the stories 
from Washington said that General Eisen- 
hower said he thought this country was 
taking chances in the cold war by not spend- 
ing more on air force, antisubmarine work, 
and Alaskan bases? 

THE PRESIDENT. That is a natural feeling 
for any military man. If I didn't have in 
view the overall budget of the United States, 
the military people would have more than 
half of it. They asked for $22 billion. You 
know they can't have that, and they know it, 
too. 



^ General Eisenhower, president of Columbia Uni- 
versity, speaking at the University on March 23, 
stated that disarmament in some of its phases had 
gone beyond the degree that he could "possibly 
advise, until we have certain knowledge that all 
nations, in concerted action, are doing likewise." 



233 



[8o] Mar. 30 



Public Papers of the Presidents 



Q. That was the figure which, as I recall 
about a year ago, you said — coming back 
from West Virginia — you said that was be- 
tween $22 and $23 billion, didn't you? 

THE PRESIDENT. Yes, that is correct. I 
don't blame them for that, because they nat- 
urally want a perfected machine. But we 
have to furnish the best defense machine 
we possibly can with the funds that we have 
available. 

Q. That is what you said then, sir. 

[At this point the President was given his coat, 
which he put on.] 

THE PRESIDENT. Do you think I'm getting 
cold? [Laughter] 

Q. In other words, you don't think this 
13 billion endangers the country? 

THE PRESIDENT. Not the slightest. If I 
thought so, I would ask for more money. 
[Laughter] The budget — I think the 
budget speaks for itself. 

[4.] Q. Mr. President, do you think 
Senator McCarthy is getting anywhere in 
his attempt to win the case against the State 
Department? ^ 

THE PRESIDENT. What's that? 

Q. Do you think that Senator McCarthy 
can show any disloyalty exists in the State 
Department? 

THE PRESIDENT. I think the greatest asset 
that the Kremlin has is Senator McCarthy. 

Q. Would you care to elaborate on that? 

THE PRESIDENT. I dou't think it needs any 
elaboration — I don't think it needs any elab- 
oration. 

Q. Brother, will that hit page one to- 
morrow! 

Q. If you think we are going to bust down 
the fence on what you have got later, that's 
a pretty good starter. [Laughter] 

Q. Mr. President, could we quote that one 
phrase, "I think the greatest asset the Krem- 
lin has is Senator McCarthy"? 

' See Item 79 and note. 



THE PRESIDENT. Now let me give you a 
litde preliminary, and then I will tell you 
what I think you ought to do. Let me tell 
you what the situation is. 

We started out in 1945, when I became 
President, and the two wars were still going 
on, and the Russians were our allies, just 
the same as the British and the French and 
Brazil and the South American countries. 
And we won the war together. 

We organized the United Nations in April 
1945, and one of the first questions that was 
asked me, after I was sworn in at 7:09 
o'clock on the 12th of April, was whether 
or not the San Francisco conference on the 
United Nations should go ahead. And I 
said it certainly will. It went ahead and we 
finally succeeded in getting a charter and 
getting it agreed to by I think 51 nations, if 
I remember correctly. 

Then our objective was to — as quickly as 
possible — get peace in the world. We made 
certain agreements with the Russians and 
the British and the French and the Chinese. 
We kept those agreements to the letter. 
They have nearly all been — those agreements 
where the Russians were involved — been 
broken by the Russians. And it became 
perfectly evident that they had no intention 
of carrying out the fundamental principles 
of the United Nations Charter and the agree- 
ments which had been made at Teheran, 
Yalta, and Potsdam. And it became evident 
that there was an endeavor on the part of 
the Kremlin to control the world. 

A procedure was instituted which came to 
be known as the cold war. The airlift to 
Berlin was only one phase of it. People be- 
came alarmed here in the United States then, 
that there might be people whose sympathies 
were with the Communist ideal of govern- 
ment — which is not communism under any 
circumstances, it is totalitarianism of the 
worst brand. There isn't any difference be- 
tween the totalitarian Russian Government 



234 



Harry S. Truman, igp 



Mar. 30 [80] 



and the Hitler government and the Franco 
government in Spain. They are all alike. 
They are police state governments. 

In 1947 I instituted a loyalty program for 
Government employees, and that loyalty 
procedure program was set up in such a way 
that the rights of individuals were respected. 

In a survey of the 2,200,000 employees at 
that time, I think there were some 205 — 
something like that — ^who left the service. 
I don't know — a great many of them left of 
their own accord. 

Q. How many, Mr. President? 

THE PRESIDENT. Somewhere in the neigh- 
borhood of 205. Does anybody remember 
those figures exactly? It's a very small 
figure. 

Q. Very small. 

THE PRESIDENT. An infinitesimal part of 
I percent. We will get the figures for you. 

And then, for political background, the 
Republicans have been trying vainly to find 
an issue on which to make a bid for the 
control of the Congress for next year. They 
tried "statism." They tried "welfare state." 
They tried "socialism." And there are a 
certain number of members of the Republi- 
can Party who are trying to dig up that old 
malodorous dead horse called "isolationism." 
And in order to do that, they are perfectly 
willing to sabotage the bipartisan foreign 
policy of the United States. And this fiasco 
which has been going on in the Senate is the 
very best asset that the Kremlin could have 
in the operation of the cold war. And that 
is what I mean when I say that McCarthy's 
antics are the best asset that the Kremlin can 
have. 

Now, if anybody really felt that there 
were disloyal people in the employ of the 
Government, the proper and the honorable 
way to handle the situation would be to 
come to the President of the United States 
and say, "This man is a disloyal person. He 
is in such and such a department." We will 



investigate him immediately, and if he were 
a disloyal person he would be immediately 
fired. 

That is not what they want. They are 
trying to create an issue, and it is going to 
be just as big a fiasco as the campaign in 
New York and other places on these other 
false and fatuous issues. 

With a little bit of intelligence they could 
find an issue at home without a bit of 
trouble! 

Q. What would it be, Mr. President? 

THE PRESIDENT. Anything in the domestic 
line. I will meet them on any subject they 
want, but to try to sabotage the foreign policy 
of the United States, in the face of the situa- 
tion with which we are faced, is just as bad 
as trying to cut the Army in time of war. 

Q. On that question we were just kidding. 

THE PRESIDENT. And that gave me a chance 
to give you an answer. To try to sabotage 
the foreign policy of the United States is just 
as bad in this cold war as it would be to 
shoot our soldiers in the back in a hot war. 

I am fed up with what is going on, and I 
am giving you the facts as I see them. 

[5.] Q. Mr. President, do you consider 
the Republican Party as a party? 

THE PRESIDENT. The policy of the Republi- 
can Party has endorsed the antics of Mr. 
McCarthy. 

Q. That affects the bipartisan 

THE PRESIDENT. That's what it is for — 
that's what it is for. They are anxious for 
the return of isolationism. 

Q. Do you think that this has torpedoed, 
then, the bipartisan 

THE PRESIDENT. It is an endeavor to tor- 
pedo the bipartisan foreign policy. They 
are not going to succeed, because the level- 
headed Republicans do not believe that at all, 
as note Mr. Stimson, Senator Vandenberg, 
Senator Saltonstall, and a dozen others I 
could name, who know exactly what is going 
on and are trying their best to cooperate. 



235 



[8o] Mar. 30 



Public Papers of the Presidents 



And I am going to try to help them prevent 
it going under. 

Q. Well, Mr. President, to carry that out 
to its logical conclusion, when these people 
come up for reelection, with the grace of God 
and so on, there is nothing that the Demo- 
cratic Party can do except simply to sit on 
the sidelines and say, "Well?" 

THE PRESIDENT. Well, it's too bad. It's a 
dangerous situation, and it has got to be 
stopped. And every citizen in the United 
States is going to find out just exactly what 
the facts are when I get through with this 
thing. 

Q. You will stand up on one side, and 
they will stand up on the other? 

THE PRESIDENT. There's only one side that 
the people will stay on, and that is the side 
that will lead to peace. That is all we are 
after. This is just another fiasco to find an 
issue. This is not it, 

Q. Mr. President, would you like to name 
any others besides Senator McCarthy who 
have participated in this attempt to sabotage 
our foreign policy? 
THE PRESIDENT. Senator Wherry. 
Q. Yes, sir? 

THE PRESIDENT. Senator Bridges. 
Q. Yes, sir? 

THE PRESIDENT. That's about as far as I 
care to go. 
Q. Okay, sir. 

[6.] Q. Now, what I forgot to say was 
would you like to say anything about Mr. 
Acheson and Mr. Lattimore,^ and — what's 
his name — ^the Ambassador at Large? 

THE PRESIDENT. Jcssup. I think I made 
myself perfectly clear that I think Dean 
Acheson will go down in history as one of 
the great Secretaries of State. You know 
very well that Mr. Jessup is as able and dis- 
tinguished a citizen as this country has ever 

* Owen Lattimore, former official of the Office of 
War Information. 



produced. Lattimore is a member of the 
faculty of Johns Hopkins University and is a 
very well informed person on foreign affairs. 

Q. You don't believe he is a spy? 

THE PRESIDENT. Why of coursc not. It's 
silly on the face of it. 

Q. Mr. President, don't you think the 
American people recognize this for what 
it is? 

THE PRESIDENT. There is no doubt about 
it. I am just emphatically bringing it to 
their attention. 

[7.] Q. For direct quotes, could we have 
that, **I think the greatest asset 

THE PRESIDENT. I would rather you would 
say that the greatest asset the Kremlin has 
is the present approach of those in the Sen- 
ate who are trying to sabotage the bipartisan 
foreign policy. 

Q. Could we have that read back to us? 

THE PRESIDENT. Sure. Jack? 

Mr. Romagna. I'm all balled up. 

THE PRESIDENT. Take your time — take 
your time. 

[As the White House Official Reporter pondered, the 
President rephrased the statement.^ 

The greatest asset that the Kremlin has is 
the partisan attempt in the Senate to sabotage 
the bipartisan foreign policy of the United 
States. 

Q. This may seem redundant, but this is 
just for the record. The partisan effort, of 
course, is the efEort by the Republicans in 
the Senate 

THE PRESIDENT. Well uow, I didn't say 
that, "partisan effort." Leave it at that. 
Draw your own conclusions. 

[8.] I am going to make some changes 
on the appointment front. I have drafted 
Stuart Symington to be Chairman of the 
National Security Resources Board, and as 
soon as I have named his successor, which 
will be in a week or 10 days, he will take 



236 



Harry S. Truman, ig^o 



Mar. 30 [80] 



over. He will stay as Secretary for Air 
until his successor is appointed and con- 
firmed. 

I am going to make Gordon Gray, for the 
time that he has left — ^you see he is going 
down as president of the University of North 
Carolina — ^between now and the time that 
he goes I am going to make him a Special 
Assistant to the President, to mobilize and 
coordinate the work in the various agencies 
of the Government, for an analysis of the 
factors bearing on the "dollar gap" disparity 
between exports and imports in the United 
States. I hope that out of these studies and 
a full public discussion of the issues will be 
developed, along bipartisan principles, pol- 
icies and programs which seem most likely 
to offer a solution to that urgent problem. 
That is the greatest problem with which 
we are faced now. Charlie^ will furnish 
you with a statement on it regarding Gordon 
Gray. 

I am going to make Frank Pace Secretary 
for the Army. I am going to appoint him — 
he has to be confirmed, you understand — 
and Fred Lawton, who is now Assistant Di- 
rector of the Budget, will be Director of the 
Budget. 

And Elmer Staats 

Q. How is that name spelled? 

THE PRESIDENT. S-t-a-a-t-s — Elmer B, Staats 
will step up from the Executive Assistant 
to the Director of the Budget Bureau to the 
Assistant to the Budget Director. He will 
take Fred Lawton's place. 

Q. Mr. President, this raises the question 
about Lawton. He has been in and out of 
that job, Vd say two — three times. There 
has always been a question as to his status. 

THE PRESIDENT. He has always been "act- 
ing" before, and he is going to be the Budget 
Director now. That is what we are trying 
to get at. He will be the Budget Director. 

* Charles G. Ross, Secretary to the President. 



Q. Mr. President, are there any more? 

THE PRESIDENT. I have got oue more — no 
more appointments, no. 

Q. Will Frank Pace become Secretary of 
the Army right away then, or very soon? 

THE PRESIDENT. Yes — ^immediately. All 
these appointments will be set up, and just 
as soon as they are confirmed, he will take 
over. 

Q. May I ask on one point, whether 
Thomas K. Finletter will succeed Syming- 
ton? 

THE PRESIDENT. I am uot ready to answer 
any questions on that. When the time 
comes, I will announce his successor.^ 

Q. Will Gray leave now to take on his new 
appointment? 

THE PRESIDENT. Now, yes. As soou as 
Pace is confirmed. 

[9.] Q. Mr. President, that dollar gap 
you spoke of, that would make it possible 
only by stimulating imports to the United 
States? 

THE PRESIDENT. That is what I am appoint- 
ing this Director for, to find out just exacdy 
what the remedy is. Last year we exported 
$16 billion worth of goods and services and 
received in return $10 billion worth. You 
can*t keep on doing business on that basis. 
That's what this is for, to find out what the 
answer is, and I can't give you the answer 
now. If I could, I wouldn't have to appoint 
the fellow. 

[10.] I had a telegram from the Gov- 
ernor of Montana, informing me that there 
had been an extreme emergency caused by 
late snow up there, and I have asked the 
General Services Administration to make an 
investigation and if it develops, why we will 
follow the same procedure we did before 
in the same circumstances. 



® The Senate confirmed the nomination of Thomas 
K. Finletter as Secretary of the Air Force on April 13, 
1950. 



237 



[8o] Mar. 30 



Public Papers of the Presidents 



Q. Give them money ? 

THE PRESIDENT. How's that? Fumish 
them with the machinery. 

[11.] Q. How long will Mr. Gray stay 
in this new job? 

THE PRESIDENT. Takes about 3 or 4 
months. He will probably want to leave 
before school starts in North Carolina. 

Q. That will mean, say, in August? 

THE PRESIDENT. Well, I am willing for him 
to stay as long as he can under the circum- 
stances. He will probably stay at least until 
the first of August. It won't take long 
to get the facts and things, and then we will 
go on from there. 

Q. In other words, this is a specific job? 

THE PRESIDENT. That's right. This will 
be the beginning of it. What he is doing 
will be to coordinate it, and we go on from 
there. When he has to go to North Caro- 
lina, we will appoint another Director. 

[12.] Q. Mr. President, I don't like to 
go back, but 

THE PRESIDENT. Go right ahead. 

Q. 1 just wondered whether the ques- 
tion of a world policy program, which you 
mentioned previously in connection with 
the appointment of a new Ambassador at 
Large, is that something entirely new that 
you are now planning? 

THE PRESIDENT. No, no, uo. You sce, 
John Foster Dulles was in that capacity 
before. We have got Mr. Cooper '^ in the 
Dulles place, when Mr. Dulles went into 
politics, and we are now enlarging the thing 

'^ John Sherman Cooper. 



to some extent. Along with Cooper, we are 
going to appoint another outstanding Re- 
publican, who believes in the United Nations, 
to go along with us and help us continue to 
coordinate the foreign policy of the United 
States. 

Q. Would it be United Nations? 

THE PRESIDENT. No, this is a United States 
program. 

Q. In effect he will succeed Jessup? 

THE PRESIDENT. That is correct — that's 
right. 

Q. Jessup, then, will no longer have the 
title of Ambassador at Large in his new 
position? 

THE PRESIDENT. No. 

Q. What is his new title? 

THE PRESIDENT. Assistant to the Secretary 
of State. 

Q. Mr. President, have you asked Mr. 
Vandenberg and other Republicans to sug- 
gest a candidate for the job? 

THE PRESIDENT. Yes, I have. 

Q. You have? 

THE PRESIDENT. I have. I havc, through 
the Secretary of State. I authorized the 
Secretary of State to make such a request. 

Reporter: Mr. President, we have had a 
wonderful time at your lawn party, and 
thank you very much. 

note: President Truman's two hundred and twenty- 
first news conference was held on the lawn of the 
Little White House, Key West, Fla., at 4:15 p.m. 
on Thursday, March 30, 1950. The White House 
Official Reporter noted that preceding the conference 
the President had entertained the newsmen at a 
picnic on the lawn. 



81 Letter to Gordon Gray Regarding His Appointment as 
Special Assistant to the President. April 3, 1950 

[ Released April 3, 1950. Dated March 31, 1950 ] 



My dear Mr, Gray: 

I am highly pleased that you find it pos- 
sible to undertake an assignment as Special 



Assistant to the President prior to assuming 
your duties later this year as President of the 
University of North Carolina. The task 



238 



Harry S. Truman, ig^o 



Apr. 3 [8i] 



which you are undertaking is of major im- 
portance to this country. 

Today the American people can look back 
with pride over our record in the field of 
foreign policy during the past five years. It 
is a record of achievement in creating a 
strong base for military defenses against the 
forces of aggression; in the development of 
international political institutions; and in 
creating economic programs designed to re- 
inforce and expand the economic base for 
world peace. 

It is hardly necessary to emphasize again 
that economic security is an essential ele- 
ment of political security. Our people 
adopted such programs as the European Re- 
covery Program and aid to Greece, Turkey 
and Korea, in the belief that, as the free 
nations felt the surge of economic strength 
and the reassurance of normal economic re- 
lationships, hope and freedom would be re- 
vived, sustained, and strengthened. This 
assistance is essential to help not only Europe 
but other areas of the world to recover from 
the war and to strengthen their economies 
against communist subversion or aggression. 

As the result of foreign efforts and Ameri- 
can assistance, in many areas production has 
increased to the point where shortages have 
diminished and the central international 
economic problem has shifted to the field of 
trade. Most countries of the world are de- 
pendent upon foreign trade for their eco- 
nomic survival. Their problem is especially 
difficult because prewar trade patterns have 
been destroyed, sources of supply have 
shifted, and sources of foreign exchange in- 
come have changed. 

The United States is at present helping to 
meet these difficulties by sending abroad 
much more of the product of American 
farms and factories than other nations are 
able to pay for from the sale of their own 
goods and services. 

This extraordinary assistance is of course 



a temporary measure. Our basic purpose 
has been, and must continue to be, to help 
build a structure of international economic 
relationships which will permit each country, 
through the free flow of goods and capital, 
to achieve sound economic growth without 
the necessity for special financial aid. 

We must be certain that we are taking 
every possible step to attain this objective. 
We have a vital economic interest in its 
achievement. The present unbalanced situa- 
tion places a heavy burden upon our national 
Budget. We are now a creditor nation, and 
this fact has an important bearing on both 
our domestic and foreign policies. We can- 
not continue to sell our goods abroad, or re- 
ceive a return on our public and private in- 
vestments abroad, unless foreign countries 
can obtain the necessary dollars to make their 
payments. 

This is of course not solely a United States 
problem. I am gratified that so many other 
countries are looking ahead and taking 
vigorous steps directed toward achieving 
their self-support. It is now time for us also 
to look ahead and assure ourselves that our 
own policies are those which will serve best 
to reinforce our economic strength and that 
of the other free nations of the world. 

This complex problem, affecting as it does 
the interests of all segments of the American 
people, also involves many agencies of this 
Government. For some time I have been 
considering how best to mobilize the re- 
sources of the Government and the experi- 
ence and thinking of our people in charting 
our course. To this end, I have decided to 
appoint you as Special Assistant to the Presi- 
dent to assist in this task. Your principal 
role in this position will be to advise and as- 
sist in coordinating and stimulating the ac- 
tivities of the various Governmental agencies 
which can contribute to the solution of the 
problem. I shall also look to you to obtain 
the views of experts and interested groups 



239 



[8i] Apr. 3 



Public Papers of the Presidents 



outside the Government on particular aspects 
of the problem. 

I feel that this task is above partisanship, 
and I am sure that your approach to it v^ill 
make this abundandy clear. The first phase 
of our w^ork is to determine the nature, 
dimensions, and significance of this problem. 
In the light of this understanding, we must 
develop the broad lines of policy v^hich in 
turn must be laid before the people and the 
Congress. This approach must have as its 
final goal a practical and forward-looking 
course of action. 

Sincerely yours, 

Harry S. Truman 

[Honorable Gordon Gray, Secretary of the Army, 
Washington, D.C.] 

note: The text of Mr. Gray's letter, dated April i, 
was released with the President's reply. 

On April 3 the White House released a back- 
ground paper on the balance of payments problem. 



Noting that the United States exported $16 billion 
worth of goods and services per year while im- 
porting only about $10 billion worth, the release 
stated that "the reduction and eventual termination 
of foreign assistance will create tremendous eco- 
nomic problems at home and abroad unless vigorous 
steps are taken both by the United States and for- 
eign countries. If no offsetting measures arc worked 
out, it may well be that United States exports will 
be sharply reduced, with serious repercussions on 
our domestic economy, and with equally serious 
effects on friendly areas of the world which are 
dependent on our goods." 

In conclusion the release stated, "There is inr 
creasing recognition in the United States that we 
are a great creditor nation and that we cannot con- 
tinue to sell our goods abroad, or receive a return 
on our investments and the credit obligations due 
us, unless foreign countries in some way or other 
can obtain the necessary hard currency to make 
these payments. . . . The goal toward which all 
nations must work is clear — one where interna- 
tional trade flows freely with as little arbitrary in- 
terference as possible." 

The President's letter was released at Key West, 
Fla. 



82 Letter to Senator Tydings Again Refusing To Disclose 

Confidential Information on Employee Loyalty. April 3, 1950 



Dear Senator Tydings: 

The Secretary of State, the Attorney Gen- 
eral, and the Chairman of the Civil Service 
Commission have referred to me the matter 
of the subpoenas w^hich have been served on 
them, directing them to appear on April 4, 
1950, before the Subcommittee established 
by the Committee on Foreign Relations of 
the Senate, pursuant to S. Res. 231, 8ist 
Congress, and to produce various documents 
and papers relating to a number of persons 
whose names appear on a confidential list 
attached to each subpoena. 

In my letter to you of March 28, 1950, 
I stated the reasons v^hy the confidential 
loyalty files of Government employees should 
not be produced. I should like at this time 
to re-state those reasons briefly. 



The disclosure of these files would 
seriously prejudice the future effectiveness 
and usefulness of the Federal Bureau of In- 
vestigation as an investigative agency; the 
embarrassment, and even danger, to those 
who have given confidential information can- 
not be overemphasized. Disclosure would 
not only deprive the Federal Bureau of In- 
vestigation and other investigative agencies 
of the Government of the availability of those 
confidential informants in the future, but 
would also gravely impair their ability to 
gather confidential information from other 
sources as well. 

The employee loyalty program depends 
upon the investigative services of the Fed- 
eral Bureau of Investigation. The disclosure 
of the files would, therefore, result in serious 



240 



Harry S. Truman, ig^o 



Apr. 3 [82] 



harm to that program. Such disclosure, in- 
stead of helping to keep disloyal people out 
of the Government service, would impair the 
very effective means we now have for accom- 
plishing that purpose. 

The investigative files of the Federal Bu- 
reau of Investigation do not contain proven 
information alone. They include any un- 
verified charges and allegations, leads and 
suspicions. Disclosure of the files would, 
therefore, result in serious injustice to, and 
damage to the reputations of, many innocent 
persons. 

The reasons why disclosure of the files 
would be contrary to the public interest were 
more fully stated by the Director of the Fed- 
eral Bureau of Investigation when he testi- 
fied before your Subcommittee on March 27, 
1950. The Attorney General at the same 
time not only fully stated the reasons of pub- 
lic policy which compel the maintenance of 
the confidential nature of the files, but also 
discussed the Constitutional precedents 
which support without any question my 
authority to take the position I have in this 
matter. 

The authority of the President in this re- 
gard has been recognized since the begin- 
nings of our Government. Our first Presi- 
dent and his Cabinet, in considering the first 
request made by a House of Congress for 
executive papers, concluded that while the 
Congress might call for papers generally, 
the Executive ought to communicate only 
such papers as the public good would permit, 
and ought to refuse those the disclosure of 
which would be contrary to the public 
interest. 

No President has ever complied with an 
order of the Legislative Branch directing 
the Executive Branch to produce confidential 



documents, the disclosure of which was con- 
sidered by the President to be contrary to 
the public interest. The Presidents who have 
had to meet that issue are numerous, and 
they have uniformly rejected such encroach- 
ments on the Constitutional power of the 
President. George Washington, James Mon- 
roe, Andrew Jackson and Grover Cleveland 
are only a few of the Presidents who have 
followed this course. In our own lifetime, 
William Howard Taft, in his book "The 
Chief Magistrate," affirmed his faith in the 
Constitutional power of the President on this 
issue. And also within this century, Attor- 
neys General serving in the Cabinets of Pres- 
idents Theodore Roosevelt, Taft, Wilson, 
Coolidge and Franklin D. Roosevelt, have 
re-stated the responsibility of the Executive 
Branch to maintain the integrity of confiden- 
tial information when its disclosure would be 
contrary to the public interest. I would be 
derelict in my duty if I failed to do so. 

I have felt obliged, therefore, to direct the 
Secretary of State, the Attorney General and 
the Chairman of the Civil Service Commis- 
sion not to comply with your subpoenas. 

As I have already informed you, I wish to 
cooperate with your Subcommittee in every 
reasonable way, and for that reason I have 
asked the bipartisan Loyalty Review Board 
to make an independent review of the loyalty 
cases before your Subcommittee. 
Sincerely yours, 

Harry S. Truman 

[Honorable Millard E. Tydings, Chairman, Subcom- 
mittee on Loyalty of State Department Employees, 
Committee on Foreign Relations, United States 
Senate, Washington, D.C.] 

note: See Item 79 and note. 

The President's letter was released at Key West, 
Fla. 



241 



[83] Apr. 3 



Public Papers of the Presidents 



83 Special Message to the Congress Upon Approving Bill 
Relating to Cotton and Peanut Acreage Allotments 
and Marketing Quotas. April 3, 1950 



To the Congress of the United States: 

On March 31, 1950, 1 approved H.J. Res. 
3985 "Relating to cotton and peanut acre- 
age allotments and marketing quotas under 
the Agricultural Adjustment Act of 1938, 
as amended, and to price supports for 
potatoes." 

I approved this measure v^ith reluctance, 
because it contains some provisions which 
seem to me to be definitely undesirable, and 
its other provisions merely undertake to alle- 
viate defects in the existing farm program 
temporarily, vv^ithout correcting those defects. 
Moreover, even this temporary relief, v^hich 
is urgently needed, v^ill require additional 
expenditures of public funds and increase 
the likelihood of future difficulties for the 
farm program. 

One part of the bill, that relating to pota- 
toes, is a step in the right direction for the 
long run. While it would do litde or noth- 
ing to remedy for this year's crop the de- 
fects in the potato price support program, it 
does hold out hope of improving this pro- 
gram for subsequent years. However, if 
each step made in improving the farm pro- 
gram in one place is to be accompanied by 
a step backward in another place, we will 
fail to make the advances in that program 
which are necessary if it is to retain the ap- 
proval of the American people. 

This Joint Resolution furnishes additional 
grounds for the charges that the present farm 
program is costly and piles up unmanage- 
able surpluses at the same time that it main- 
tains artificially high prices for agricultural 
commodities. What is needed is for the Con- 
gress to approach this problem with a view 
to correcting the fundamental shortcomings 
in the present farm program rather than 



patching it up with makeshift legislation. 

In spite of the shortcomings of the pres- 
ent Joint Resolution, I have decided that the 
urgent need for the relief which it will give 
to cotton producers, and the promise which 
it holds out for making some improvement 
in the potato program, outweigh the defects 
of the measure. 

The principal relief provided is in the 
form of additional cotton acreage allotments. 
The cotton acreage allotment system was re- 
vised by the Congress last year. In that legis- 
lation, against the advice of the Secretary of 
Agriculture, the Congress adopted an allot- 
ment system based primarily upon the farm- 
er's acreage of crop land. The legislation 
provided in detail the method by which 
allotments were to be made. Just as the 
Secretary of Agriculture had warned, this 
legislation has had grossly inequitable re- 
sults. Some cotton farmers were required 
to make little or no reduction in cotton acre- 
age to comply with their allotments, other 
cotton farmers were required to reduce their 
acreage by as much as eighty percent. The 
present Joint Resolution merely provides 
additional cotton acreage allotments for this 
year to alleviate the hardship in those cases 
where the reductions have been inequitably 
severe. It does not remedy the basic defect 
in the present system of determining cotton 
acreage allotments. Indeed, in one respect 
it makes it even worse. It provides, in ef- 
fect, that cotton acreage which is surrendered 
by one farmer and re-allotted, even though it 
is not planted by any farmer, must continue 
in future years to be allotted to that same 
county and State. This provision is ob- 
viously not necessary to relieve present in- 
equities and it is clearly unfair to areas 



242 



Harry S. Truman, ig^o 



Apr. 3 [83] 



where cotton farmers are being severely re- 
stricted in their plantings, and favors areas 
making little or no contribution to the re- 
duction of cotton production. 

I urge the Congress to revise the perma- 
nent laws regarding the cotton acreage allot- 
ments and marketing quotas. Such legisla- 
tion should provide for allotments to be based 
primarily upon each farmer's past planting 
history. Furthermore, it should give ample 
latitude to farmer-elected local committee- 
men, so that they may alleviate inequities 
among their neighbors and make adjust- 
ments for local conditions. These principles 
are generally in effect for all major crops 
but cotton, and experience has demonstrated 
their superiority to those embodied in the 
cotton legislation enacted last year, from 
which farmers are now seeking relief. 

Sections 3, 4, and 5 of H.J. Res. 398 deal 
with Irish potatoes. The most important of 
these is Section 5, which provides that no 
price support shall be granted to potatoes 
for the crop year 1951 and later years unless 
marketing quotas are in effect. Since no 
marketing quotas for potatoes are permitted 
by present law, this Section amounts to a 
policy declaration by the Congress that it 
intends to enact better price support legisla- 
tion for potatoes than we now have. With 
this purpose I am in hearty accord. 

Successive Secretaries of Agriculture have 
been urging the Congress for several years 
to enact better legislation regarding potatoes, 
in order to bring supplies into line with 
demand, to provide better distribution of 
surplus potatoes, and to reduce the cost of 
the program to the Government. To amend 
present law to provide for effective market- 
ing quotas would be a substantial improve- 
ment over the present situation. It would 
not, however, in my judgment, be all that 
is necessary. I again urge the Congress to 
authorize a system of production payments 



for potatoes (and other perishable commodi- 
ties) so that unavoidable surpluses can be 
sold to consumers and used, instead of taken 
off the market and largely wasted. 

Sections 6 and 7 of the Joint Resolution 
deal with peanuts. Section 7 is designed to 
provide some relief for the peanut farmers 
in several States (particularly Alabama and 
Texas) whose acreage was cut especially 
severely under present law. I believe that 
the peanut farmers of the States affected 
should have such relief, and that is one of 
the reasons which led me to approve the 
Joint Resolution. 

Section 6, however, is another matter. 
This Section would permit the planting of 
peanuts to be increased substantially above 
the acreage allotments now established. 
The peanuts produced on these extra acres 
would not be eligible for price support, but 
would, instead, be sold for crushing, and the 
farmer would receive only what the result- 
ing peanut oil would bring on the market. 
The domestic "two-price" system for pea- 
nuts thus established is subject to serious 
objections. 

First, under present conditions, the pro- 
duction of peanuts for oil is unprofitable for 
the growers and is an uneconomic and waste- 
ful use of agricultural resources. During 
the war and right afterwards, when fats and 
oils were in seriously short supply, we needed 
peanut oil badly. Now that supplies of soy- 
beans and other more economical sources of 
edible fats and oils are again sufficient, it 
would be foolish to go on using good land 
to produce peanuts for oil which would not 
yield a profit to the growers. I believe that 
peanut farmers will realize that it would 
not be to their own best interest to expand 
their plantings of peanuts greatly. Conse- 
quently, I do not expect large additional 
amounts of peanuts to be produced for oil 
as a result of this Section. Nevertheless, 



243 



[83] Apr. 3 



Public Papers of the Presidents 



this provision represents a breach in the 
integrity of the quota system upon which the 
support price program depends. If it should 
be taken as a precedent for other crops, the 
whole support price program might be 
endangered. 

Second, the administrative diflSculties of 
operating this "two-price" system for pea- 
nuts will be very great. In order to prevent 
the diversion of peanuts produced on the 
excess acres to the higher of the two price 
outlets, an extensive system of inspection, 
identification, and supervision will have to 
be developed. Administrative difficulties 
should not stand in the way of desirable 
programs, but in this case a complicated, 
costly, and annoying administrative network 
will be required for a very dubious purpose. 

Above and beyond these specific objec- 
tions to Section 6, it may have very unfor- 
tunate implications for future years and other 
crops. If farmers do produce large quanti- 
ties of peanuts for oil at no profit, there will 
inevitably be pressures for supporting the 
price of peanut oil in the future, which 
would only complicate matters further. 
Even more serious, if these special provisions 
for peanuts were to be regarded as a prece- 
dent, it may be urged that similar provisions 
should be enacted for other crops, regardless 
of the disruption that could result to domes- 



tic and world markets. I believe it would 
be a very serious mistake for us to embark 
on such a course, and I do not regard this 
peanut provision as anything but a tempo- 
rary aberration from proper legislation. 

We face no small task in providing a sys- 
tem of agricultural legislation which will 
serve the needs of farmers for a fair income 
and will, at the same time, serve the needs 
of consumers for ample supplies of foods^ 
fibers, and other crops at reasonable prices^ 
and the needs of the whole Nation for a 
growing, expanding economy and a healthy 
world trade. During the present postwar 
transition period, our agricultural legisla- 
tion is necessarily cosdy, but we obviously 
cannot afford to add to those costs for pur- 
poses which will not contribute to the real 
long-run interests of farmers or the Nation. 

I urge the Congress to proceed to consider 
fundamental improvements in our agricul- 
tural legislation to make it more eflficient, 
less costly, and more conducive to abundant 
production of farm crops, yielding a fair 
return to farmers, and selling at prices con- 
sumers can afford. 

Harry S. Truman 

note: As enacted, H.J. Res. 398 is Public Law 471, 
8 1 St Congress (64 Stat. 40). 

The President's message was released at Key West, 
Fla. 



84 Special Message to the Congress on the Unemployment 
Insurance System. April 6, 1950 



To the ^Congress of the United States: 

One of the great advances in economic 
legislation made during the 1930's was to 
establish the Federal-State system of employ- 
ment security. This system has two parts — 
first, a nation-wide employment service to 
help workers find jobs and employers find 
job-seekers, and, second, a nation-wide sys- 
tem of unemployment insurance to help tide 



workers over periods of unemployment. 

Finding a job is of more importance to an 
unemployed worker, of course, than receiv- 
ing unemployment insurance benefits. Con- 
sequently, great emphasis has always been 
placed on strengthening and improving the 
employment service. 

We cannot, however, completely eliminate 
unemployment; even in times of high em- 



244 



Harry S. Truman, ig^o 



Apr. 6 [84] 



ployment, there will be turnover of jobs and 
numerous shifts and changes in job oppor- 
tunities. Consequently, we must have a 
strong and steadily improving system of 
unemployment insurance. 

Under our Federal-State unemployment 
insurance system, benefits are paid, in ac- 
cordance with State laws, to workers who, 
while able and seeking to work, are unem- 
ployed through no fault of their own. These 
benefits are paid from the proceeds of State 
payroll taxes, which are deposited in reserve 
accounts — one for each State — ^in the Unem- 
ployment Trust Fund in the United States 
Treasury. 

In the past twelve years, unemployment in- 
surance has proved its worth not only as an 
invaluable source of support to unemployed 
workers and their families, but also as a 
means of maintaining purchasing power of 
great value to the entire economy. In 1949, 
for example, 1.7 billion dollars in bene- 
fits were paid to more than seven million 
individuals, the largest amount for any year 
in the history of the system. This was a 
significant factor in preventing serious dis- 
locations during last year's period of eco- 
nomic readjustment. 

Our experience with unemployment in- 
surance has revealed weaknesses as well as 
strengths in the existing system. While 
many improvements have been made in the 
State laws since the program began, the sys- 
tem is far from adequate today. 

Over 15 million workers — about one-third 
of all employees — are not protected by unem- 
ployment insurance. In 1949, only about 
one-fifth of the purchasing power lost 
through unemployment was replaced by un- 
employment insurance benefits. In 1949, 
weekly benefits averaged only about $20 — 
not enough to preserve a minimum standard 
of living. Nearly 2 million workers used up 
their benefits entirely — showing that benefits 
were not available for a long enough period. 



While the unemployment reserve funds of 
the States have so far proved to be adequate, 
a few States may soon face financial difficul- 
ties because of local concentration of un- 
employment. 

On several occasions in recent years, I have 
recommended that the system be improved, 
to extend protection to many workers not 
now covered; to provide, in every State, bene- 
fits for 26 weeks ranging up to $30 a week 
for single persons, with additional bene- 
fits for dependents; and to increase the fi- 
nancial stability of the system. 

Action on these proposals has become 
more urgent as unemployment has increased 
somewhat in spite of the continuing high 
levels of business activity. While unemploy- 
ment dropped over half a million between 
February and March, on the average nearly 
4^ million persons were looking for work 
during the first three months of this year, 
as compared to 3 million in the same months 
of 1949, and nearly 254 million in 1948. 
Furthermore, the length of time it takes peo- 
ple to find jobs is becoming longer. One 
million people — about one out of every four 
unemployed — have been out of work for 15 
weeks or more. A year ago, only 420,000 
were without jobs that long, and in 1948, 
only 330,000. 

This gradual growth in unemployment 
over the last two years is not because there 
are fewer jobs. Employment has remained 
at high levels, along with industrial produc- 
tion, consumer incomes, and other indica- 
tors of the health of our economy. 

But there are more people looking for 
work. In recent years, up to one million 
more people have come into the labor market 
each year, looking for work, than have left 
the labor market. Part of the new group 
entering the labor market this year will be the 
largest number of college graduates in our 
history — ^some 500,000 young people, includ- 
ing about 250,000 veterans. In addition, of 



245 



[84] Apr. 6 



Public Papers of the Presidents 



course, a large number of high school grad- 
uates will also be looking for jobs. 

Furthermore, as new plants and equip- 
ment have been added and supplies of raw 
materials have become more ample, busi- 
nessmen have been able to produce more with 
the same number of workers. 

Thus, our labor force has increased, our 
productivity has increased, but the num- 
ber of jobs has not kept pace. This empha- 
sizes the importance of expanding our 
economy so that new jobs will be created to 
use skills and energies that are now being 
wasted. It also emphasizes the importance 
of making better provision for those who are 
temporarily out of work. 

The Congress now is well along toward 
completing action on legislation to improve 
the old-age and survivors' insurance and pub- 
lic assistance programs. Like those pro- 
grams, the unemployment insurance system 
needs to be improved in the light of experi- 
ence. Accordingly, I recommend that the 
Congress turn its attention as soon as possible 
to strengthening our Federal-State unem- 
ployment insurance system. 

First, I recommend that coverage be ex- 
tended to about 6 million workers not now 
covered. The first major deficiency in the 
present Federal-State system of unemploy- 
ment insurance is that it excludes large num- 
bers of workers. 

Coverage should be extended to employees 
of small firms — those employing one to seven 
workers. Workers in firms employing 
fewer than eight workers were originally 
left out of the Federal law because of ex- 
pected administrative difficulties. In fact, 
however, such employees have been satisfac- 
torily covered for years under the Federal 
old-age and survivors' insurance system, and 
17 States have already extended their unem- 
ployment compensation systems to cover 
them, without encountering any serious ad- 



ministrative difficulties. Many other States 
are waiting for the Federal Government to 
act, and have provisions in their laws which 
would cover these employees automatically 
when the coverage of the Federal Act is ex- 
tended. No reason exists for discriminating 
longer in the Federal law against such 
workers. 

Coverage should also be extended to Fed- 
eral Government civilian employees. Al- 
though the Federal Government took the 
leadership in establishing a system of unem- 
ployment insurance for workers in private 
industry, it has not assumed the same obliga- 
tion toward its own employees. Yet the 
rate at which Federal workers — especially 
manual workers — are separated from their 
jobs is approximately as high as in private 
industry. Federal workers should no longer 
be denied the protection of unemployment 
insurance. 

I also propose extensions of coverage to 
about 500,000 persons who are employed on 
a commission basis, and about 200,000 work- 
ers in occupations of an industrial nature 
connected with agriculture, all of whom are 
excluded at present. Moreover, the Federal 
unemployment insurance legislation should 
be extended to Puerto Rico, subject to its 
acceptance by the Territorial Legislature. 

Second, I recommend the establishment of 
nation-wide minimum levels for amounts 
and duration of unemployment benefits, in 
order to correct the second major deficiency 
in the present unemployment insurance sys- 
tem — the inadequacy of benefits. 

At present, while the Federal law includes 
a number of standards which the States are 
required to meet, it does not establish mini- 
mum levels for benefit amounts or duration. 
Maximum weekly benefits in the various 
States now range from $15 to $27 for single 
persons; benefits are somewhat larger for 
persons with dependents in the 11 States 



246 



Harry S. Truman, ig^o 



Apr. 6 [84] 



providing dependents' allowances. With 
these maximum levels, average weekly bene- 
fits for the Nation as a whole were just over 
$20 in 1949. 

The variations among States create serious 
inequities. They mean that workers who 
lose their jobs in identical circumstances are 
treated very differently because of the acci- 
dent of geographical location. They mean 
that businessmen in some States sujffer a 
greater loss in markets when unemployment 
occurs than do those in other States. 

Furthermore, while the States generally 
have increased benefits in recent years, so 
that the situation is not nearly so bad as in 
the case of old-age and survivors' benefits, 
in most States the increases in benefits have 
lagged considerably behind increases in 
wages and costs of living. Thus, unemploy- 
ment benefits today replace a smaller propor- 
tion of a worker's regular wages than was 
the case when the system was started. 

For these reasons, I believe that nation- 
wide minimums should be established by 
law which will assure adequate benefits in 
all States. The standards proposed are 
these: benefits for single persons should 
approximate 50 percent of normal earnings, 
up to a maximum of at least $30 a week. 
Additional allowances should be granted for 
individuals with dependents. The propor- 
tion of previous earnings replaced would 
vary with the number of dependents, up to a 
maximum of 70 percent of wages, or $42, 
whichever is lower, for an individual with 
three or more dependents. 

These standards are not high. If they had 
been in effect, the national average weekly 
benefits in 1949 would have been just over 
$24. But this would be a substantial im- 
provement in an income level which, at best, 
is intended to provide only for subsistence 
expenses. Furthermore, uniform standards 
would reduce present inequities in benefit 



levels among different States. Some varia- 
tion in benefit amounts would and should 
remain, reflecting the differences in wage 
levels and costs of living in different parts 
of the country. 

At present, the maximum duration of 
benefits varies among the States from 12 to 
26 weeks. Like the variation in size of bene- 
fits, this is inequitable, and in many States 
simply represents a lag in reaching what was 
considered from the beginning to be a desir- 
able standard, but which was originally set 
low because of actuarial uncertainties. With 
this wide range, the average duration of 
benefits in 1949 was less than 13 weeks. 
Because of the short duration of benefits, 
nearly 2 million workers exhausted their 
rights to benefits before finding another job. 

Benefits should be available for at least 26 
weeks in a year to all workers who are out 
of work that long. Experience in the States 
which have increased the duration of bene- 
fits is that while average duration does not 
rise very much, because most workers find 
a new job before using up benefits, the num- 
ber who use up their benefits entirely is 
markedly decreased. It is estimated that, 
under my proposal, the number of workers 
who exhausted their benefits in 1949 would 
have been only half as large as it was. 

The combined effect of my recommenda- 
tions for extended coverage, higher benefits, 
and longer duration, would have resulted in 
about $850 million more in benefits — and in 
consumer demand — in 1949. The cost of 
these improvements would be moderate. At 
the same time that weekly benefits are raised, 
the upper limit to the amount of wages taxed 
should be raised from $3,000 to $4,800 per 
worker, in line with the increases in wage 
levels. On this basis, the combined cost of 
all benefits for all States under these pro- 
posals would have been about 1.2 percent of 
taxable payrolls in 1948 and 2.5 percent in 



247 



[84] Apr. 6 



Public Papers of the Presidents 



1949 — compared with actual costs (on the 
basis of the present $3,000 wage limit) of 
.9 percent of taxable payrolls in 1948 and 
2.2 percent in 1949. 

In most States, the rate of tax has been 
extremely low in recent years — ^many em- 
ployers have had to pay no tax whatever. 
Some States have had to increase rates some- 
what last year or this year, but in all but a 
few cases, taxes are still well below the rate 
of 2.7 percent contemplated when the system 
was started. Under my proposals, many 
States would not have to increase tax rates 
to cover all the increased costs, since they 
still have excess reserves. Most, if not all, 
States would find no trouble meeting the 
additional costs within the 2.7 percent tax 
rate. 

Consequently, I believe that the standards 
I propose will achieve substantial improve- 
ment in the unemployment insurance sys- 
tem, benefiting both workers and business- 
men, at very reasonable costs. As is the case 
at present with respect to coverage, the Fed- 
eral law should not prevent the States from 
exceeding the minimum standards if they 
wish to do so. 

Third, I recommend that adequate meth- 
ods should be required to provide benefits 
for workers who move from one State to 
another. 

Clearly a worker who is employed in two 
different States during a year is as entitled 
to unemployment insurance benefits when 
out of work as a worker who is employed in 
only one. The States have generally recog- 
nized this, and have attempted voluntarily 
to work out methods for paying benefits 
in such interstate cases. They have, how- 
ever, been only partially successful. Inter- 
state workers generally must wait much 
longer to receive benefits than intrastate 
workers. Furthermore, the benefits of many 
interstate workers are lower than if they had 



worked in only one State. 

It is a difficult problem to develop ade- 
quate methods for paying benefits promptly 
and equitably to interstate workers in our 
Federal-State unemployment insurance sys- 
tem. Nevertheless, it is in the national in- 
terest to encourage the mobility of labor, 
since that is indispensable to economic ex- 
pansion in a free society like ours. Conse- 
quently, I believe that the States should be 
required to adopt such methods as are neces- 
sary to provide fair and adequate protection 
for interstate workers. 

Fourth, I recommend that both Federal 
and State laws concerning fraud and dis- 
qualifications should be revised and 
improved. 

It was a weakness in the original Federal 
legislation that it did not clearly require the 
States to deal adequately with the question 
of fraud. Some States — without going to 
uneconomical extremes in inspection and po- 
licing — have instituted effective methods for 
preventing or detecting fraudulent claims. 
I beUeve, however, that the Federal law 
should be clarified so that all States can be 
required to have adequate means for deal- 
ing with those few individuals who attempt 
to obtain benefits through misrepresentation. 

During the last few years, some States 
have considerably enlarged the number of 
reasons for disqualifying workers who seek 
unemployment benefits and have increased 
the severity of penalties for disqualification. 
These excessive disqualifications have oper- 
ated to prevent persons who are genuinely 
out of work through no fault of their own 
from receiving benefits. These over-severe 
disqualification provisions, which penalize 
the innocent along with the guilty, should be 
corrected. 

Fifth, I recommend, at this time, two im- 
provements in the financing arrangements 
for unemployment insurance. 



248 



Harry S. Truman, ig^o 



Apr. 6 [84] 



Since the beginning of the program, a 
small part of the unemployment tax has been 
collected by the Federal Government and in- 
cluded in general Federal revenues. The 
administrative costs of the program — both 
Federal and State — have been paid out of 
general Federal revenues, and have never 
been as large as the Federal unemployment 
tax collections. I propose that the Federal 
unemployment tax be paid into a special 
Federal unemployment account in the Un- 
employment Trust Fund (which now in- 
cludes the separate State reserve accounts 
for the payment of benefits). This account 
would be used exclusively to pay the cost 
of State and Federal administration of the 
employment security program, and the cost 
of reinsurance grants, to be available to 
States who encounter temporarily severe fi- 
nancial difficulties. 

Experience has demonstrated that the cost 
of unemployment insurance varies widely 
among the different States. This is mainly 
due to differences in each State's economic 
structure and in the incidence of unemploy- 
ment in certain industries, which are be- 
yond the control of the individual State. It 
has become evident that a few States, while 
able to finance an adequate system of unem- 
ployment insurance in normal periods, may 
not be able to maintain the solvency of their 
unemployment funds in a period of severe 
unemployment under the present financial 
provisions provided in the Federal legisla- 
tion. So that these States will not be forced 
to increase their tax rates unduly during 
periods of declining employment and pay- 
rolls, the legislation should be amended to 
provide assistance to such States through re- 
insurance grants when their funds approach 
exhaustion. This will be a major step to- 
ward strengthening our Federal-State system 
of unemployment insurance, since it will, 
without detracting from the independence 



of State action, gain some of the advantages 
of pooled reserves. 



A strengthened unemployment insurance 
system not only will furnish more adequate 
aid to those who become unemployed, but 
also will do more to maintain the high vol- 
ume of consumer purchasing power so nec- 
essary to the welfare of the entire economy. 
Thus it is a strong element in our program 
to support growth and expansion in the 
economy. 

Our essential economic problem is to put 
to sound, productive use our increasing tech- 
nical knowledge and our growing labor 
force. To this end, we need imaginative 
and enterprising investment — in plant ca- 
pacity, in new equipment, in basic resource 
development. To this end, we need vigor- 
ous competition and a growing number of 
new businesses. To this end, we need a 
stable agriculture, sensible wage-price-profit 
decisions, and mature labor-management 
relations. To this end, we need an expand- 
ing world economy, with a productive flow 
of international trade and investment. 

Both private and public policies must be 
directed to these purposes, and I have rec- 
ommended a series of measures to the 
Congress for Federal action. My present 
proposal to strengthen our unemployment 
insurance system is one of these measures. 

I am particularly urging action at this 
session of Congress on unemployment insur- 
ance because State legislation must follow 
the Federal amendments. Action by the 
Congress this year would clear the way for 
State action in 1951, when practically all of 
the State legislatures will be meeting in 
regular session. 

But the primary reason for Congressional 
action is the real need of those who are 
unemployed. The unemployment insurance 
system is a tried and proven means of assist- 



41-355— .65- 



-19 



249 



[84] Apr. 6 



Public Papers of the Presidents 



ing them. That system urgently needs 
strengthening. I therefore request favorable 
consideration of these recommendations at 
this session of Congress. 

Harry S. Truman 



note: For the statement by the President upon sign- 
ing the Social Security Act Amendments of 1950 
on August 28, see Item 224. 

The President's message was released at Key West, 
Fla. 



85 Remarks of Welcome to the President of Chile at the 
Washington National Airport. April 12, 1950 



IT IS with sincere pleasure, Mr. President, 
that I welcome you to the United States. 
We shall do our utmost to make your stay 
among us pleasant and interesting. 

I am happy to welcome you as the chief 
executive of a sister republic whose citizens 
have constantly been inspired by devotion to 
the democratic principles which we cherish. 
Your arrival symbolizes the traditional and 
warm friendship that has long existed be- 
tween our two countries. 

It is a source of satisfaction that, in the 
spirit of friendly cooperation and inter- 
American solidarity, Chile and the United 



States are continuing their efforts to assure 
the security and peace of the world. Our 
countries are motivated by the same concern 
for individual freedom and human welfare. 

We in the United States are honored by 
your visit and heartily extend our sincere 
good wishes to you personally and for the 
prosperity of your people and your country. 

Welcome, Mr. President! 

note: President Truman spoke at 3:05 p.m. from 
a speaker's stand erected at the Military Air Trans- 
port terminal, adjacent to the National Airport. 
President Gonzdlez Videla was greeted with a 21- 
gun salute and full military honors. 



86 The President's News Conference of 
April 13, 1950 



THE PRESIDENT, [i.] I wiU explain to you 
why I was late. The President of Chile was 
our guest last night at the Blair House, and 
it is necessary for the President to see the 
distinguished guests away from the Blair 
House when they leave. We were a little 
late making the arrangements, hence you had 
to wait 10 minutes — which doesn't happen 
very often. 

I have no announcements to make. If 
you have any questions, I will listen to them. 

[2.] Q. Mr. President, Charles Binaggio 
and Charles Gargotta were both witnesses 
before a Federal grand jury in Kansas City 
probing rackets. Now, 8 days after they 



were killed,^ the Attorney General appar- 
endy has not found legal authority to bring 
the FBI into the investigation. Governor 
Smith, I understand, wired the FBI for all- 
out assistance, immediately after the killings. 
I have two questions to ask, sir: one, do you 
think this is a Federal matter; and two, will 
you ask the Attorney General to send the 

FBI 

THE PRESIDENT. That is a matter for the 



* Charles Binaggio and Charles Gargotta were 
found shot to death at the First Ward Democratic 
Club in Kansas City, Mo., on the morning of April 
6, 1950. Both men had testified before a special 
Federal grand jury in Kansas City that had been 
called to investigate nationwide crime and vice. 



250 



Harry S. Truman, ig^o 



Apr. 13 [86] 



Attorney General himself to determine. 
The grand jury was called in Kansas City 
at my suggestion to the Attorney General 
several months ago. 

[3.] Q. Mr. President, are you in agree- 
ment with the Attorney General, who has 
been quoted as saying that all forms of 
segregation are discriminatory? 

THE PRESIDENT. I think we have been 
working for that for some time past. 
Haven't you read any of my messages on 
that subject? 

Q. Yes sir, but they didn't cover that, I 
don't think, and 

THE PRESIDENT. When you read the mes- 
sages you will get the plain answer. 

[4.] Q. Mr. President, have you dis- 
cussed the Binaggio case with the Attorney 
General? 

THE PRESIDENT. I have not. It is not in 
my jurisdiction. I have not discussed it with 
them and don't expect to discuss it with 
them. 

Q. Mr. President, when Senator Lucas was 
here the other day, did he discuss the crime 
situation in general with you? 

THE PRESIDENT. No, he did not. 

Q. Mr. President, can you tell us any more 
about the request that you made which 
resulted in the calling of the grand jury in 
Kansas City — anything on the scope of the 
investigation that you ordered? 

THE PRESIDENT. The scope of the investi- 
gation was to, if possible, get to the bottom 
of these national rackets. And the Attorney 
General called the grand jury at my sugges- 
tion for that purpose. The rackets are 
nationwide, they are not confined to Kansas 
City or St. Louis or — ^there are as many in 
St. Louis as there are in Kansas City. They 
are in every big city in the country, even in 
Washington, if I am not mistaken. 

[5.] Q. Mr. President, do you wish to 
comment on the recent visit to Washing- 
ton — the presence of the Secretary of the 



Treasury, Mr. Cereijo of Argentina, who has 
been here 

THE PRESIDENT. I havc uo commeut to 
make on that. I did see the Finance Min- 
ister. I understand that he went away from 
here highly pleased with the result of his 
visit. 

[6.] Q. When you spoke of calling the 
grand jury at your suggestion, do you mean 
just the grand jury in Kansas City? 

THE PRESIDENT. Just the grand jury in 
Kansas City. 

Q. Weren't there grand juries in a good 
many other cities at the same time? 

THE PRESIDENT. Ycs. Grand juries were 
already in session in several other cities, and 
I suggested one be called in Kansas City and 
one for St. Louis. The one for St. Louis 
I don't think was called. 

Q. You meant it to be nationwide in scope? 

THE PRESIDENT. Yes, I meant it to be na- 
tionwide in scope. 

Q. You meant it to be that? 

THE PRESIDENT. That is exacdy right. 

[7.] Q. Mr. President, that grand jury 
doesn't have anything to do with the theft 
of the ballot boxes, does it? ^ 

THE PRESIDENT. Not this. 

Q. Have you discussed that with the At- 
torney General? 

THE PRESIDENT. I have UOt. 

Q. You realize that the Statute of Limita- 
tions will run in this case? 

THE PRESIDENT. I dou't kuow anything 
about it. 

[8.] Q. Did you have a good visit with 
the President of Chile last night, sir? 

^ The vault of the Kansas City Board of Election 
Commissioners in the Jackson County Courthouse 
in Kansas City, Mo., was broken into during the 
night of May 27-28, 1947, and the contents of three 
metal ballot boxes, containing ballots, poll books, 
and tally sheets, were stolen. The articles had been 
returned to the vault the day before after being used 
as evidence by a State grand jury in a 2-month 
investigation of alleged vote manipulation in the 
August 1946 primary election. 



251 



[86] Apr. 13 



Public Papers of the Presidents 



THE PRESIDENT. Very good visit. That is 
quite a jump from St. Louis to Santiago, 
Chile, isn't it? [Laughterl 

Q. Did you take up any economic or politi- 
cal subjects? 

THE PRESIDENT. I did not. The President 
of Chile is coming to pay an official call on 
me at 4 o'clock this afternoon, and we shall 
discuss any subject in which he is interested. 

[9.] Q. Mr. President, Senator Taft said 
this week that you had libeled Senator 
McCarthy. Would you care to make any 
comment? 

THE PRESIDENT. Do you think that is pos- 
sible? [Laughterl 

Q. May we quote that? 

THE PRESIDENT. YeS. 

Q. Well, Mr. President, are you aware of 
what Senator Taft said? He wrote a whole 
column for his Ohio paper. 

THE PRESIDENT. I haveu't read Senator 
Taft's column, and I do not make it my 
business to read political publications of peo- 
ple who are running for office 

Q. Would you repeat that for us? 

THE PRESIDENT. ^particularly in one 

statement. 

Q. It was a general criticism of the admin- 
istration's attitude 

THE PRESIDENT. That would be natural for 
Senator Taft. He is running for reelection 
in Ohio, and I suppose he has something else 
in mind a couple of years from now. 
[Laughter'\ 

Q. Yes. I thought you were interested, 
perhaps, in this year's campaign. 

THE PRESIDENT. I am Very much inter- 
ested in it. 

[10.] Q. Mr. President, can we get back 
to the Missouri matter, not related to 

THE PRESIDENT. Anything. I told you you 
could ask any questions and I will answer all 
lean. 

Q. Do you have any comment on Gover- 
nor Smith's gasoline tax proposal — ^this is a 



double-barreled question — ^would you care 
to say if you voted for or against 

THE PRESIDENT. I dou't think it's any- 
body's business how I voted, but I was for 
the increase in the tax and I voted for it 
[Laughter]^ 

Q. Any comment on the defeat? 

THE PRESIDENT. I have uo commeut on the 
defeat. The people of Missouri just simply 
didn't want it, I reckon. They overwhelm- 
ingly thought that they didn't want it. 

[11.] Q. Mr. President, I see Myron 
Taylor is on the calling Ust today. Do 
you intend to reappoint him to the Vati- 
can? 

THE PRESIDENT. I have no comment on that, 
and I do not intend to comment on that 
this morning. Mr. Taylor is here on private 
business of his own. 

[12.] Q. Mr. President, I would like to 
revert to the one last question 

THE PRESIDENT. Shoot all the questions 
you want. 

Q. In your opinion, could you construe the 
murder of the two Federal witnesses as 
tampering with witnesses before a Federal 
grand jury? 

THE PRESIDENT. I am uot iu the legal busi- 
ness, and you can make your own con- 
struction on that. 

[13.] Q. Mr. President, Senator Tobey 
says he is asking you to name a New Eng- 
lander to the Interstate Commerce Commis- 
sion. I wonder if you plan to do that? 

THE PRESIDENT. What's that? 

Q. Senator Tobey was down here and 
asked you to name a New England man to 
the ICC. I wonder if you plan to do that? 

THE PRESIDENT. Senator Tobey made a 
recommendation for the ICC, and he will 
have the same consideration that several 
dozen other people have that have been 
recommended to me from all parts of the 
United States. There are other States in 
the Union as well as New Hampshire. 



252 



Harry S. Truman, ig$o 



Apr. 13 [86] 



[14.] Q. Mr. President, several groups, 
including Republicans, are protesting the de- 
lay in action on FEPC until the foreign 
aid measure is acted on. Can you comment 
on that? 

THE PRESIDENT. Yes, I cau commeut on it. 
The reason for the postponement was due 
to the fact that the EGA appropriation 
should get into the omnibus appropriation 
bill in the House. Unless it is passed 
promptly, it will not get into that omnibus 
bill. The FEPC will be carried to the logical 
conclusion, and every effort will be made to 
pass FEPC prompdy without starting a fili- 
buster against an international matter that 
is of vital importance to the whole world. 

[15.] Q. Mr. President, some months 
ago you oudined for us a nationwide pro- 
gram of river valley development, and you 
astounded us with your knowledge of river 
geography. Have any steps been taken in 
the direction of fulfilling that program? 

THE PRESIDENT. Surveys are being made, 
and I have some preliminary reports on it. 

Q. That is in the Missouri Valley 

THE PRESIDENT. How's that? 

Q. That is the Missouri Valley? 

THE PRESIDENT. The whole Mississippi 
Valley — Pittsburgh to Denver, and from 
Minneapolis to New Orleans. 

[16.] Q. Have you been personally re- 
viewing the necessary preliminaries for our 
responsibilities in the forthcoming reciprocal 
trade talks? 

THE PRESIDENT. Ycs, I have. 

Q. Have you completed that? 

THE PRESIDENT. Not quite. 

[17.] Q. Do you think the first 5 years 
are the hardest? [Laughter] 

THE PRESIDENT. That is an easy thing for 
a person to say. The first 5 years have been 
rather difficult, but the country is still on its 
feet. And in spite of some unemployment, 
we have more people at work than ever be- 
fore in the history of any country in the 



history of the world. We have the most 
prosperous business setup that the coun- 
try has ever seen, if the Wall Street reports 
are to be believed. We have the farmer in 
better financial condition than he has ever 
been in the history of the country, except at 
the top point in 1948, 1 think it was. And 
I can't see that there is any serious thing the 
matter with the country as a whole. I think 
it's in fine shape. In fact, the first 5 years 
after the greatest war in history have been 
easier on the United States than the after- 
math of any other war that was ever fought 
in this country, if you will read your his- 
tory a little carefully. 

Of course, it couldn't possibly be that the 
Executive is to be credited with that situa- 
tion. That just took place. It would have 
taken place if we had had a moron on the 
job, according to the way the general attitude 
of some of the press is. [Laughter] 

But I think that the President can take 
credit for the situation, and that is what he 
proposes to do. [More laughter] 

Q. Next month sometime, Mr. President? 

[18.] Q. Mr. President, I notice you say 
the farmers are in the best condition, but 
how about the rest of us, with the surpluses 
and the high food prices? 

THE PRESIDENT. I think that you get plenty 
to eat, Miss May,^ and I have an idea that 
you are getting a bigger salary than you ever 
have gotten before in your life. 

Q. Yes sir, but they don't get as much as 
I do. 

THE PRESIDENT. That's true, but they are 
getting more than they ever got before in 
their history. 

Q. But there are still surpluses to be de- 
stroyed. 

THE PRESIDENT. If you wiU study the situa- 
tion, you will find that the principle of sur- 
pluses being destroyed was brought about 

®Mrs. May Craig of the Portland (Maine) Press 
Herald. 



253 



[86] Apr. 13 



Public Papers of the Presidents 



by your representative in the Senate from 
Maine, and it was potatoes that caused most 
of the trouble. 

Q. Butter, eggs, wheat, corn, cotton 

THE PRESIDENT. Yes, the output of every 
farmer is at its greatest and farmers are 
prosperous, and we have a solution for that, 
a proposition which has been in the Con- 
gress ever since the ist day of January of this 
year to meet that problem. We have the 
solution for it. If you will work for that 
solution as hard as you are bringing atten- 
tion to the surpluses, we will get it solved. 

Q. Is that the Brannan plan? 

THE PREsroENT. That is the Brannan plan.* 

[19.] Q. Mr. President, getting back to 
your answer a minute ago where you cov- 
ered the domestic situation, I was just won- 
dering if you feel that the problems of peace 
are any more difficult now — I mean in the 
last 20 months than they were? This is a 
perennial question, and I know you com- 
mented on it before. 

THE PRESIDENT. I think the situation world- 
wide is better than it was in 1946, and I think 
there has been a gradual improvement. 

[20.] Q. Mr. President, do you plan to 
campaign for the Brannan plan when you go 
to Wisconsin in May? 

THE PRESIDENT. What's that? 

Q. Do you plan to speak for the Brannan 
plan when you go to Wisconsin in May? 

THE PRESIDENT. I am goiug ou a nonpolit- 
ical tour to dedicate some dams, and I think 
my speeches will not be partisan or political. 
The one in Chicago may be, but that will be 
at the end of the trip. 



*On April 7, 1949, Secretary of Agriculture 
Charles F. Brannan appeared at a joint session of the 
House and Senate Agriculture Committees, at which 
time he outlined his price support plan. The plan 
would substitute an income support standard for 
the previous parity formula, use direct payments to 
farmers when prices of certain perishables fell too 
far below parity, and let those perishables sell to 
consumers at supply and demand prices. 



Q. Will you "dam" the Republicans a litde 
bit in Chicago ? [Laughter] 

THE PRESIDENT. I beg your pardon? 

Q. Will you "dam" the Republicans a litde 
bit in Chicago? 

THE PRESIDENT. Well, you had better wait 
and see. I don't like to prophesy what I am 
going to say. I think you found that out 
on the train. 

[21.] Q. Mr. President, if you plan to 
sign the new housing bill, can you give us 
some idea of how soon that action might 
come? 

THE PRESIDENT. The bill has not come to 
my desk yet. It is being analyzed by the 
various departments. When it comes to my 
desk, why I will let you know about it.^ 

[22.] Q. How about the Kerr bill, Mr. 
President? 

THE PRESIDENT. The Kerr bill is under con- 
sideration now. It is being analyzed in the 
various departments. 

[23.] Q. Mr. President, is there any light 
you can shed on the disappearance of the 
Navy Privateer over the Baltic? ^ 

THE PRESIDENT. There is an investigation, 
and it has been ordered by Admiral ConoUy,'^ 
and I can make no comment on it until we 
know all the facts. 

[24.] Q. Mr. President, have you re- 
ceived a series of gifts and telegrams from 

^On April 20, 1950, the President signed the 
Housing Act of 1950 (64 Stat. 48). 

®On April 8, 1950, a United States Navy patrol 
plane vanished over the Baltic Sea. The plane, 
carrying four officers and six enlisted men, was a 
Privateer, a four-engined plane with a tail assembly 
somewhat resembling that of the B-29. U.S. ofii- 
cials stated that the plane left Wiesbaden Air Base 
in Germany and that its destination was Copen- 
hagen, Denmark. Some debris was later sighted 
by search planes, but there were no survivors. 

The Soviet Government subsequently stated that 
Russian planes had fired upon a B~29 Flying For- 
tress after it had failed to comply with orders and 
had opened fire upon the Soviet planes. 

''Rear Adm. Richard L. Conolly, commander of 
the U.S. fleet in the Mediterranean and east 
Ariantic. 



254 



Harry S. Truman, ig^o 



Apr. 13 [86] 



Congressman Heselton of Massachusetts? ® 
Any comment on that, sir? 

THE PRESIDENT. No commcnt. 

Q. What do you do with them? 

THE PRESIDENT. What do I do with them? 
There's a nice, round file under my desk. 
[Laughter] 

[25.] Q. Mr. President, your old friend 
Dr. Gallup says that right now your popu- 
larity is not what it might be. Do you think 
that you might do something about that on 
this trip? 

THE PRESIDENT. Will you tum back to 
about March 1948, and read Mr. Gallup? 

Q. Yes sir, I know that. 

THE PRESIDENT. Well, that's about on the 
same par with that. 

[26.] Q. Mr. President, will you make 
any talks in Ohio on your way to or from 
Chicago? 

THE PRESIDENT. I Can't auswcr that ques- 
tion, because the details of the trip have not 
been outlined as yet. Grand Coulee and 
Chicago are the only definite dates. 

[27.] Q. Mr. President, you said the 
international situation is better now than it 
was in 1946? 

THE PRESIDENT. YcS, it is. 

Q. Have you a reason for choosing 1946 
rather than 1945? 

THE PRESIDENT. I think 1 946 was about 
the worst time that we had anywhere. It 
was shortly after 1946 that we instituted 
the program for Greece and Turkey, and the 
Marshall plan came in June 1947. That was 
about the worst time with which we were 
faced that I can remember, except by a shoot- 
ing war itself. 

[28.] Q. Mr. President, going back to 



®The White House had been receiving a large 
number of telegrams from Representative John W. 
Heselton of Massachusetts expressing his views on 
agriculture and the surplus food situation. The gifts 
that he had forwarded to the President were small 
boxes of rice, dried peas, dried milk, shelled peanuts, 
potatoes, and similar farm products. 



those nonpartisan, nonpolitical speeches, do 
you consider the Brannan plan a partisan and 
political issue? 

THE PRESIDENT. No, it is uot a partisan, 
political issue. It is for the benefit of all 
the farmers of the United States. 

Q. Well then, Mr. President, you are 
not 

THE PRESIDENT. And there are lots of Re- 
publican farmers that haven't been properly 
educated yet, or they would be Democrats. 
[Laughter] 

Q. Mr. President, we didn't hear that 
last 

THE PRESIDENT. Wait — ^you didn't give me 
a chance — ^you didn't give me a chance to 
finish my answer to your question. If you 
will give me a chance to answer your ques- 
tion, I will be glad to do it. 

I said the Brannan plan was not a partisan 
program, it is for the benefit of all the 
farmers of the United States, and there are 
lots of Republican farmers, I think, that if 
they had been properly educated they 
wouldn't be Republicans. 

What is the rest of your question now? 

Q. Well then, with that thought, you are 
not barred from speaking 

THE PRESIDENT. I am not barred from 
speaking on anything I want to — [Laugh- 
ter] — ^but I don't intend to make any what 
you might call partisan speeches on this trip. 

Q. Mr. President, does that still look like 
five or six major speeches? 

THE PRESIDENT. Oh, I Can't answcr you, 
because there are only — ^well, as I told you 
awhile ago, there are three stops in Wyo- 
ming to dedicate another dam — ^visit another 
dam. And I can't tell you how many 
speeches it will be. It will depend on how 
many stops we have. 

Q. A speech at every stop, sir? 

THE PRESIDENT. There may be 50 or 60 be- 
fore we get through. [Laughter] 

Q. We'll bring the oxygen tent with us. 



255 



[86] Apr. 13 



Public Papers of the Presidents 



THE PRESIDENT. You had better bring the 
oxygen tent. [Laughter] 
Reporter: Thank you, Mr. President. 
THE PRESIDENT. You're welcome. 



note: President Truman's two hundred and twenty- 
second news conference was held in his oflSce at the 
White House at 10:40 a.m. on Thursday, April 
13, 1950. 



87 Remarks to Members of the U.S. National Commission 
for UNESCO. April 13, 1950 



THANK YOU very much. It is a pleasure 
to have you here. I am vitally interested in 
what you are doing and what you are trying 
to do, and always have been. 

Somebody remarked that there were a 
great many of you and that the handshaking 
might tire out my arm. For your informa- 
tion, the last year that Mrs. Truman and I 
were in the White House, she shook hands 
with 50,000 people and I shook hands with 
25,000, aside from those that I ran into in 
1948 on the road, accidentally. The arm has 
to be in good condition, for we have another 
program coming up that will be somewhat 
similar to that of 1948. This time we are 
trying to elect a Congress that believes in 
international cooperation, wholeheartedly — 
a Congress that believes the welfare of the 
United States demands a continuing foreign 
policy that takes into consideration the whole 
globe, instead of just one county or one dis- 
trict or one State. 

The work that you are doing is of vital 
importance. Education is the fundamental 
basis of freedom. The Renaissance, I think, 
began the approach to our form of govern- 
ment, although that form originated back 
with the Hebrews and the Greeks and the 
Romans, Of course, that is only one man's 
opinion, as one radio commentator would 
say. 

Then also we are exceedingly anxious to 
see that the good things of life are made 
available to the poorer parts of the world. 



That may sound like a worldwide WPA, 
but it is nothing of the kind. My ambition 
is to help these people to help themselves. I 
am sure that is what you have in mind. 

I am giving the United Nations, and this 
organization in particular, all the support I 
can possibly give as President of the United 
States. I want to see you successful and I 
want to see the United Nations successful, 
and I honesdy believe that both of you will 
be a complete success in the course of time. 

We expect things to happen too fast. The 
United States is noted for its go-getters. We 
make plans today and try to get them done 
tomorrow. In organizations such as yours 
and the United Nations, if over a generation 
or two generations we come close to accom- 
plishing our purpose, we have made great 
progress. It took the first 80 years of the 
existence of the Republic of the United States 
to get it established, and then we had to whip 
ourselves before we got it done. 

In working to get this plan of ours imple- 
mented on a worldwide basis, we are work- 
ing for the peace of the world. That is what 
we are all working for. That is what your 
educational program is for — to prevent the 
killing of the young men and young women 
of the generations that are to come. 

One of the diflSculties of Europe is the fact 
that the great countries of Europe suffered 
two world cataclysms, in which the younger 
generation was killed off by the millions. 
That sort of loss can't be repaired immedi- 



256 



Harry S, Truman, ig^o 



Apr. 15 [88] 



ately. We don't want that to happen to us. 
We have been exceedingly lucky in both the 
world wars, in that we did not lose an over- 
whelming number of our coming genera- 
tions. 

I hope you will keep up your good work, 
and that you will be entirely successful. And 



if I can help you, I am right here to do it. 
Thank you very much. 

note: The President spoke at 12:15 p.m. in his 
office at the White House. The National Commis- 
sion, whose function is to advise the United States 
Government on the affairs of UNESCO, opened its 
eighth semiannual conference at the Department of 
State on April 13. 



88 Veto of Bill To Amend the Natural Gas Act of 1938. 
April 15, 1950 



To the House of Representatives: 

I return herewith, without my approval, 
H.R. 1758, a bill to amend the Natural Gas 
Act approved June 21, 1938, as amended. 

This bill would preclude the Federal 
Power Commission from regulating sales of 
natural gas to interstate pipe line companies, 
for resale in interstate commerce, by pro- 
ducers and gatherers who are not afl&liated 
with the buyers. After careful analysis and 
full consideration, I believe that such an 
action would not be in the national interest. 

I believe that authority to regulate such 
sales is necessary in the public interest be- 
cause of the inherent characteristics of the 
process of moving gas from the field to the 
consumer. Unlike purchasers of coal and 
oil, purchasers of natural gas cannot easily 
move from one producer to another in search 
of lower prices. Natural gas is transported 
to consumers by pipe lines, and is distributed 
in a given consuming market by a single 
company. The pipe line companies, and in 
turn the consumers of natural gas, are bound 
to the producers and gatherers in a given 
field by the physical location of their pipe 
lines, which represent large investments of 
funds, and cannot readily be moved to other 
fields in search of a better price. 

These characteristics of the natural gas 
business impose natural limitations upon 
effective competition among sellers. Com- 
petition is further limited by the degree of 



concentration of ownership of natural gas 
reserves. While there are a large number of 
producers and gatherers, a relatively small 
number of them own a substantial majority 
of the gas reserves. Furthermore, the de- 
mand for natural gas has been growing 
phenomenally in recent years, and its natural 
advantages as a fuel, coupled with its present 
price advantage, indicate that demand may 
soon be pressing hard upon total supplieSr 

Under these circumstances, there is a clear 
possibility that competition will not be ef- 
fective, at least in some cases, in holding 
prices to reasonable levels. Accordingly, to 
remove the authority to regulate, as this 
bill would do, does not seem to me to be wise 
public policy. 

It is argued that regulation of sales of 
natural gas to pipe line companies would 
discourage producers and gatherers from sell- 
ing their gas in interstate commerce, and 
would discourage exploration and develop- 
ment of new wells. This claim rests pri- 
marily on the assumption that the Federal 
Power Commission would apply standards 
of regulation which did not take account 
of the peculiar circumstances of natural gas 
production — ^such as the cost of exploration 
and development, including the drilling of 
dry holes. I do not believe this assumption 
is well-founded. On the contrary, I am con- 
fident that the Commission will apply stand- 
ards properly suited to the special risks and 



41-355 



257 



[88] Apr. 15 



Public Papers of the Presidents 



circumstances of independent natural gas 
producers and gatherers. 

My confidence in this outcome is sup- 
ported by the fact that, until recendy, the 
Commission has not found it necessary to 
undertake to regulate the prices charged 
by independent gas producers and gatherers, 
although those prices have been advancing. 
It is only natural that prices have risen, since 
the interstate lines built during and since 
the v^ar have offered a far wilder market 
than existed previously and have resulted 
in more competition among buyers. This 
process of price adjustment will probably 
continue, and it is right that it should if 
held within reasonable limits. 

Accordingly, producers and gatherers arc 
finding, and I am sure will continue to find, 
strong incentives to search out new sources 
of natural gas and to sell their gas in inter- 
state commerce. I believe the production 
and sale of natural gas will continue to grow 
rapidly, to the benefit of consumers and of 
all the businessmen concerned with serving 
them. I see no danger to that growth in the 
continuance of the authority of the Federal 
Power Commission to regulate sales of gas 
to interstate pipe lines. 

The continuance of that authority will ade- 



quately protect the public interest by per- 
mitting the Commission to prevent unrea- 
sonable and excessive prices, which would 
give large windfall profits to gas producers, 
at the expense of consumers, with no benefit 
to the Nation in terms of additional explora- 
tion and production. Such cases are few, if 
any, at the present time, but the authority 
to deal with them in the future clearly should 
not be dissipated. 

Experience may demonstrate that some 
improvement of the existing statute may be 
desirable. I have no doubt that the Com- 
mission will operate reasonably and in the 
public interest in carrying out the present 
law, but I would have no objection to rea- 
sonable amendments if they are found to 
be needed. 

To withdraw entirely from this field of 
regulation, however, impelled only by imagi- 
nary fears, and in the face of a record of ac- 
complishment under the present law which 
is successful from the standpoint of con- 
sumer, distributor, carrier, and producer 
alike, would not be in the public interest. 
Accordingly, I am compelled to return this 
bill without my approval. 

Harry S. Truman 



89 Statement by the President on the Importance of Maintaining 
a Bipartisan Foreign Policy. April 18, 1950 



I HAVE had a very satisfactory talk vnth 
Secretary Acheson and Senator Bridges, who 
is the ranking Republican of the Senate in 
Senator Vandenberg's absence. We dis- 
cussed a number of the more important 
problems facing this Nation in the field of 
foreign relations and also some of the prob- 
lems involved in finding a workable means 
for keeping the Republican minority in- 
formed currently. On my instructions. 
Secretary Acheson has previously consulted 



with Senator Connally as well as with Sena- 
tor Vandenberg and other Democratic and 
Republican Members of Congress. In addi- 
tion to the discussions I have had with 
Senator Bridges, I have also talked person- 
ally with Members of the Senate of both 
parties. I expect to obtain the views of still 
others on this subject. 

With the problems facing the United 
States in the field of foreign relations it is 
most important that every effort be made to 



258 



Harry S. Truman, igp 



Apr. 19 [91] 



maintain a true bipartisan foreign policy. 
It will be my purpose, as well as that of 
Secretary Acheson, not only to keep the 
members of the minority currently informed, 



but to solicit their views and take them into 
serious account in both the formulation and 
implementation of our foreign policy. 

note: See also Item 96. 



90 Letter to the Speaker on the Plight of Greek Children Abducted 
by Communist Guerrilla Forces. April 19, 1950 

[ Released April 19, 1950. Dated April 18, 1950 ] 



My dear Mr, Speaker: 

I fully share the concern of the House of 
Representatives for the thousands of children 
removed from Greece to eastern Europe by 
the communist guerrilla forces, and I wel- 
come the adoption of House Resolution 514 
of March 22, 1950, calling for the speedy 
return of these children to their homes and 
homeland. 

The rights of children and parents to share 
the protection, comradeship and beneficent 
influence of a family home are fundamental 
and have been implicitly recognized, in the 
case of the Greek children, in two unanimous 
resolutions of the United Nations General 
Assembly. It is morally inadmissible that 
political considerations or technical difficul- 
ties should be allowed to stand in the way 
of the reunion of these children with their 
parents. 



The Executive Branch of the Government 
has been persistent in its endeavors to secure 
effective compliance with the United Nations 
resolutions in this case. These efforts will 
not be relaxed until the Greek children are 
back in their homes. 

Very sincerely yours, 

Harry S. Truman 

[Honorable Sam Rayburn, Speaker of the House of 
Representatives, Washington, D.C.] 

note: The text of House Resolution 514 is as fol- 
lows: "Resolved, That the House of Representatives 
expresses its profound concern for the thousands of 
Greek children removed or carried off into countries 
of eastern Europe by the Communist guerrilla forces 
during the course of the recent guerrilla warfare in 
Greece, and requests the President to exert all of his 
powers, acting through the United Nations and other 
international organizations and directly with the 
governments of the countries where these children 
are located, to the end that these thousands of chil- 
dren shall be speedily returned to their homes and 
homeland." 



91 Statement by the President Upon Signing Bill for the Aid of the 
Navajo and Hopi Indian Tribes. April 19, 1950 



I HAVE today signed S. 2734, a bill author- 
izing a long-range economic rehabilitation 
program for the Navajo and Hopi Indian 
Tribes. 

The passage of this act is an important 
milestone in our Government's administra- 
tion of Indian affairs. It represents a care- 
fully developed plan for dealing with the 
unsolved economic problems which have 
delayed the social advancement of this large 



segment of our Indian citizens. For these 
Indian groups it also represents a significant 
forward step in self-government — 2l principle 
to which the American people are deeply 
devoted. 

The enactment of this bill in its present 
form is a source of much gratification to me. 
I found it necessary to veto its predecessor 
(S. 1407) because of a section which would 
have placed the Navajo and Hopi Indians 



259 



[gi] Apr. 19 



Public Papers of the Presidents 



under the civil and criminal jurisdiction of 
the States in which they reside. The step 
was premature; it was not desired by tlie 
Indians themselves; and it might have placed 
in jeopardy both human and property rights 
of the Indians. 

At the time I returned S. 1407 without my 
signature, I stated that I would be glad to 
approve a bill that incorporated the desirable 
features so necessary to the future welfare of 
these Indian groups, if the Congress should 
see fit to pass a measure without the objec- 
tionable provisions. 

The present bill (S. 2734) is in substance 
the predecessor bill without the provisions 
to which I objected. It authorizes improve- 
ments which will help the Indians achieve 
greater economic stability, will provide better 
educational opportunities, and will lead to 
the improvement of their health. Among 
other helpful provisions is one which gives 
the Navajo Tribal Council greater control 
over the expenditure of tribal funds. The 
act also authorizes the Navajo Indians to 
adopt a constitution, which would enable 
them to exercise broad powers in the man- 
agement of their own affairs. 

It is reassuring to learn from the telegram 
of the chairman and vice chairman of the 



Navajo Tribal Council, urging approval of 
the bill, that the "Navajos look forward with 
hope to the Government's commitment to 
help them solve their economic and social 
problems." I assure the members of the 
Council of my continued interest in their 
efforts toward economic and social advance- 
ment. I particularly invite their attention 
to section 8 of the bill which states the inten- 
tion of the Congress that the tribal councils 
and the Indian communities affected by this 
program shall be kept informed and shall be 
consulted as the program develops. I also 
wish to assure the members of both the Hopi 
and Navajo Tribes that their religion and 
social customs will be fully respected in 
accordance with this Nation's long-estab- 
lished laws and traditions. 

I believe that the economic development 
program outlined in this bill will start the 
Indians of the Navajo and Hopi Reserva- 
tions on the way to economic self-sufficiency, 
which has been too long delayed. It is my 
sincere hope that the Congress will promptly 
appropriate the full amount requested in my 
1 95 1 budget to initiate this program. 

note: As enacted, S. 2734 is Public Law 474, 8ist 
Congress (64 Stat. 44). 



92 Address on Foreign Policy at a Luncheon of the American 
Society of Newspaper Editors. April 20, 1950 



Mr, Chairman, distinguished guests, mem' 
hers of the American Society of Neu/spaper 
Editors: 

I am happy to be here today with this 
group of editors. You and I have a great 
many important problems in common, and 
one of the most important of these is the 
responsibility we share in helping to make 
the foreign policy of the United States of 
America. That is why I am going to take 



this opportunity to discuss with you some 
of the aspects of that policy. 

No group of men in this country is of 
greater importance to our foreign policy 
than the group your society represents. 

In a democracy foreign policy is based on 
the decisions of the people. 

One vital function of a free press is to 
present the facts on which the citizens of 
a democracy can base their decisions. You 



260 



Harry S. Truman, ig^o 



Apr. 20 [92] 



are a link between the American people and 
world affairs. If you inform the people 
well and completely, their decisions will be 
good. If you misinform them, their deci- 
sions will be bad; our country will suffer 
and the world will suffer. 

You cannot make up people's minds for 
them. What you can do is to give them the 
facts they need to make up their own minds. 
Now that is a tremendous responsibility. 

Most of you are meeting that responsibility 
well — ^but I am sorry to say a few are meeting 
it very badly. Foreign policy is not a matter 
for partisan presentation. The facts about 
Europe or Asia should not be twisted to con- 
form to one side or the other of a political 
dispute. Twisting the facts might change 
the course of an election here at home, but 
it would certainly damage our country's pro- 
gram abroad. 

In many other countries today, the papers 
print about foreign affairs only what their 
governments tell them to print. They can't 
add anything, or cut anything. In the de- 
mocracies, the papers have a free hand. 
Only in a democracy is there such mutual 
trust and confidence among citizens that a 
private group is given such an all-important 
role in determining what the Nation as a 
whole shall do. There is too much nonsense 
about striped trousers in foreign affairs. Far 
more influence is exerted at home by the 
baggy pants of the managing editor than 
ever is exerted by the striped pants in the 
State Department. 

There never has been a time in our his- 
tory when there was so great a need for our 
citizens to be informed and to understand 
what is happening in the world. 

The cause of freedom is being challenged 
throughout the world today by the forces of 
imperialistic communism. This is a strug- 
gle, above all else, for the minds of men* 
Propaganda is one of the most powerful 



weapons the Communists have in this strug- 
gle. Deceit, distortion, and lies are systemat- 
ically used by them as a matter of deliberate 
policy. 

This propaganda can be overcome by the 
truth — ^plain, simple, unvarnished truth — 
presented by the newspapers, radio, news- 
reels, and other sources that the people trust. 
If the people are not told the truth, or if they 
do not have confidence in the accuracy and 
fairness of the press, they have no defense 
against falsehoods. But if they are given 
the true facts, these falsehoods become laugh- 
able instead of dangerous. 

We can have confidence that the free press 
of the United States and most of the other 
free nations will keep us from being de- 
ceived by Communist propaganda. But in 
other parts of the world the struggle between 
falsehood and truth is far more intense and 
far more dangerous. 

Communist propaganda is so false, so 
crude, so blatant, that we wonder how men 
can be swayed by it. We forget that most of 
the people to whom it is directed do not have 
free access to accurate information. We for- 
get that they do not hear our broadcasts or 
read impartial newspapers. We forget that 
they do not have a chance to learn the truth 
by traveling abroad or by talking freely to 
travelers in their own countries. 

All too often the people who are subject 
to Communist propaganda do not know 
Americans, or citizens of other free nations, 
as we really are. They do not know us as 
farmers and as workers. They do not know 
us as people having hopes and problems like 
their own. Our way of life is something 
strange to them. They do not even know 
what we mean when we say "democracy." 

This presents one of the greatest tasks 
facing the free nations today. That task is 
nothing less than to meet false propaganda 
with truth all around the globe. Every-^ 



261 



[92] Apr. 20 



Public Papers of the Presidents 



where that the propaganda of the Commu- 
nist totalitarianism is spread, we must meet 
it and overcome it with honest information 
about freedom and democracy. 

In recent years there has been tremendous 
progress all over the world in education and 
the exchange of ideas. This progress has 
stirred men everywhere to new desires and 
new ambitions. They want greater knowl- 
edge, they want better lives, they want to be 
masters of their own affairs. We have helped 
and encouraged these people, but the Com- 
munists have seized upon their desires and 
ambitions and are seeking to exploit them 
for their own selfish purposes. 

In the Far East, for example, millions are 
resdessly seeking to break away from the 
conditions of poverty and misery that have 
surrounded them in the past. The Com- 
munists understand this situation very well. 
They are trying to move in and take ad- 
vantage of these aspirations. They are mak- 
ing glittering promises about the benefits of 
communism. They reach directly to the 
peasant or the villager in these vast areas, and 
talk to him direcdy in his own tongue about 
the things he has learned to desire. They 
say that they can get these things for him. 
And too often he hears no voice from our 
side to that dispute. 

We know how false these Communist 
promises are. But it is not enough for us to 
know this. Unless we get the real story 
across to the people in other countries, we 
will lose the battle for men's minds by pure 
default. 

The Communist propaganda portrays the 
Soviet Union as the world's foremost advo- 
cate of peace and the protector of defenseless 
peoples. The contradiction between what 
the Communist leaders have promised and 
what they have actually done is so starding 
that we are amazed that anyone can be de- 
ceived. In Berlin, in Czechoslovakia, in the 
Balkans, in the Far East, they have proved, 



time after time, that their talk about peace 
is only a cloak for imperialism. But their 
intended victims will not learn these facts 
from Soviet propaganda. We are the ones 
who must make sure that the truth about 
communism is known everywhere. 

At the same time, we must overcome the 
constant stream of slander and vilification 
that the Communists pour out in an effort to 
discredit the United States and other free 
nations. 

Soviet propaganda constantly reviles the 
United States as a nation of "warmongers" 
and "imperialists." You and I know how 
absurd this is. We know that the United 
States is wholly dedicated to the cause of 
peace. We have no purpose of going to war 
except in the defense of freedom. Our ac- 
tions demonstrate that we mean exactly what 
we say. But when men throughout the 
world are making their choice between 
communism and democracy, the important 
thing is not what we know about our pur- 
poses and our actions — the important thing 
is what they know. 

Communist propaganda also seeks to de- 
stroy our influence in the world by saying 
the American economy is weak and about to 
collapse. We know this is preposterous. 
The industrial production of the United 
States is equal to that of all the rest of the 
world combined. Our agricultural produc- 
tion is more than adequate for our needs. 
Our people enjoy the highest standard of liv- 
ing in the history of the world. Our eco- 
nomic strength is the bulwark of the free 
world. 

From every standpoint, our free way of life 
is vasdy superior to the system of oppression 
which the Communists seek to impose upon 
mankind. In many parts of the world, 
however, where men must choose between 
freedom and communism, the story is going 
untold. 

We cannot run the risk that nations may 



262 



Harry S. Truman, ig^o 



Apr. 20 [92] 



be lost to the cause of freedom, because their 
people do not know the facts. 

I am convinced that we should greatly 
extend and strengthen our efforts to make 
the truth known to people in all the world. 

Most of us have recognized for years, of 
course, how important it is to spread the 
truth about freedom and democracy. We 
are already doing some very good work — 
through the **Voice of America" and the 
United States information offices and li- 
braries in many parts of the world, through 
the exchange of students, through the United 
Nations and its aiOGiliated organizations, and 
in many other ways. But events have shown, 
I believe, that we need to do much more, both 
ourselves and in cooperation with the other 
free nations. We must use every means at 
our command, private as well as govern- 
mental, to get the truth to other peoples. 

Private groups and organizations have an 
important part to play. Our labor unions 
have already done fine work in communi- 
cating with labor in Europe, in Latin 
America, and elsewhere. The story of free 
American labor, told by American trade 
unionists, is a better weapon against Com- 
munist propaganda among workers in other 
countries than any number of speeches by 
Government officials. 

The same principle applies to other groups. 
The best way for farmers in other countries 
to find out about us is to talk direcdy with 
our own farmers. Our businessmen can 
speak directly to businessmen abroad. We 
need to promote much more direct contact 
between our people and those of other 
countries. 

We should encourage many more people 
from other countries to visit us here, to see 
for themselves what is true and what is not 
true about this great country of ours. We 
should find more opportunities for foreign 
students to study in our schools and univer- 



sities. They will learn here the skills and 
techniques needed in their own countries. 
They will also see at first hand the rights 
and duties of citizens in our land of demo- 
cratic institutions. 

Our colleges should train more Americans 
to go abroad as teachers, especially to teach 
modern methods of farming, industry, and 
public health — and, by example, to teach 
our concepts of democracy. The notable 
record of our many charitable and religious 
organizations who send teachers abroad is a 
proof of what can be done. 

Another major part of our effort must be 
carried out through our great public infor- 
mation channels — newspapers and maga- 
zines, radio, and motion pictures. We must 
strive constantly to break down or leap over 
barriers to free communication wherever 
they exist. We must make full use of every 
effective means of communicating informa- 
tion, in simple, understandable form, to 
people whose backgrounds and cultures are 
different from our own. 

This poses an enormous challenge to 
groups such as yours, a challenge which can 
be met only by extraordinary inventiveness 
and enterprise. I am confident that the 
American press can and will make a tre- 
mendously useful contribution toward find- 
ing new solutions. 

The Government's programs for telling 
the truth about the United States to the peo- 
ples of the world also need constant im- 
provement. Our present overseas informa- 
tion and educational exchange program is 
getting results. For example, the "Voice of 
America" has been carrying to people be- 
hind the Iron Curtain the true story of 
world events. It has been so successful that 
the Soviet government is using a vast amount 
of cosdy equipment in an attempt to drown 
out our broadcasts by jamming. We must 
devise ways to break through that jamming 



263 



[92] Apr. 20 



Public Papers of the Presidents 



and get our message across. And we must 
improve and strengthen our whole range 
of information and educational services. 

This is not a conclusion reached by Gov- 
ernment officials alone. We have had the 
valuable aid of the United States Advisory 
Commission on Information created by the 
Congress. Your own society is ably rep- 
resented on that commission by Mr. Mark 
Ethridge and Mr. Erwin D. Canham. The 
members of the Commission have given in- 
tensive study to the overseas information 
program and have made repeated recom- 
mendations that it be substantially expanded. 
Similar recommendations for the exchange 
program have been made by the Advisory 
Commission on Education, headed by Dr. 
Harvie Branscomb. I have been glad to 
see that many members of the Congress have 
urged an improved and expanded program 
in these fields — as shown, for example, by the 
resolution introduced recently by Senator 
Benton for himself and a number of his col- 
leagues. 

Because of the pressing need to increase 
our efforts along this line, I have directed 
the Secretary of State to plan a strengthened 
and more effective national effort to use the 
great power of truth in working for peace. 
This effort will require the imagination and 
energies of private individuals and groups 
throughout the country. We shall need 
to use fully all the private and governmental 
means that have proved successful so far — 
and to discover and employ a great many 
new ones. 

Our task is to present the truth to millions 
of people who are uninformed or misin- 
formed or unconvinced. Our task is to reach 
them in their daily lives, as they work and 
learn. We must be alert, ingenious, and dili- 
gent in reaching peoples of other countries, 
whatever their educational and cultural back- 
grounds may be. Our task is to show them 
that freedom is the way to economic and so- 



cial advancement, the way to political inde- 
pendence, the way to strength, happiness, 
and peace. 

This task is not separate and distinct from 
other elements of our foreign policy. It is 
a necessary part of all we are doing to build 
a peaceful world. It is as important as 
armed strength or economic aid. The 
Marshall plan, military aid, point 4 — these 
and other programs depend for their suc- 
cess on the understanding and support of 
our own citizens and those of other coim- 
tries. 

We must make ourselves known as wc 
really arc — ^not as Communist propaganda 
pictures us. We must pool our efforts with 
those of other free peoples in a sustained, 
intensified program to promote the cause of 
freedom against the propaganda of slavery. 
We must make ourselves heard round the 
world in a great campaign of truth. 

We have tremendous advantages in the 
struggle for men's minds and loyalties. We 
have truth and freedom on our side. The 
appeal of free institutions and self-govern- 
ment springs from the deepest and noblest 
aspirations of mankind. It is based on every 
man's desire for liberty and opportunity. It 
is based on every man's wish to be self-reliant 
and to shape his own destiny. 

As we go forward with our campaign of 
truth, wc will make lasting progress toward 
the kind of world we seek — a world in which 
men and nations live not as enemies but as 
friends and brothers. 

note: The President spoke at 2 p.m. at the Hotel 
Statler in Washington. His opening words "Mr. 
Chairman" referred to B. M. McKelway of the Wash- 
ington Star, president of the American Society of 
Newspaper Editors. In the course of his remarks 
he referred to Mark Ethridge, publisher of the Louis- 
ville Times and the Louisville Courier-Journal, 
Erwin D. Canham, editor of the Christian Science 
Monitor, and Dr. Harvie Branscomb, chancellor of 
Vanderbilt University. 

The annual convention of the American Society 
of Newspaper Editors was held in Washington April 
20-27, 1950. 



264 



Harry S. Truman, ig$o 



Apr, 21 [93] 



93 Special Message to the Congress Urging Extension 
of Rent Control. April 21, 1950 



To the Congress of the United States: 

In my State of the Union Message in 
January, I recommended extension of rent 
control for another year beyond the present 
expiration date of June 30. Developments 
since that time have made it even clearer 
that a Federal program of rent control is 
still required in many localities. I wish, 
therefore, to reemphasize the urgency of 
Congressional action to extend the rent con- 
trol program. 

I strongly advocate extension of rent con- 
trol because I am convinced that the public 
interest requires it. Housing is the one area 
of acute shortage remaining from v^artime. 
Removal of controls v^ould mean serious 
hardship for millions of tenants who are 
caught in a "seller's market" and cannot ob- 
tain lower rents by shopping around. Until 
supply is near enough to demand so that 
the forces of competition will again operate 
effectively to protect the tenant, rent control 
should continue. 

At the same time, we should continue the 
present policy of granting the landlord all 
justifiable increases in rent. The basis of 
our policy has been fairness to both the land- 
lord and the tenant. 

Since the end of the war, our aim has con- 
sistently been to overcome the housing short- 
age. With this objective, we have vigor- 
ously pressed programs to expand the 
volume of housing. At the same time, we 
have decontrolled rents in a gradual and 
orderly manner, community by community, 
as soon as the supply of housing in each 
community achieved reasonable balance with 
the demand. Extension of rent control for 
another year will be consistent with this 
policy. It will also contribute substantially 
to the stability of the national economy as a 
whole. 



The policy of orderly decontrol has re- 
sulted in a steady reduction of the number of 
units under control. At its peak in 1946, 
Federal rent control covered over 16 million 
dwelling units. It now covers 11 million. 
Within the last year, the Housing Expediter 
has decontrolled 1,300,000 rental units while 
State and local governments have decon- 
trolled 1,800,000 units. However, in many 
cases State and local decontrol actions were 
premature, and resulted in excessive in- 
creases in rents. 

Actions taken by four States will remove 
Federal rent control from an additional 
2,600,000 rental units by July i, 1950. The 
bulk of these units will not actually be decon- 
trolled but instead will be shifted from Fed- 
eral to State rent control. Even taking into 
account these latest State actions, over 8 
million rental units will still be under Fed- 
eral control. 

In areas where Federal control has re- 
mained in effect, the Housing Expediter has 
followed a fair policy in granting rent in- 
creases to landlords. During the last year 
alone, increases have been authorized cover- 
ing over 900,000 units. The average in- 
crease authorized was 18 per cent. 

But while we have made progress in re- 
ducing the coverage of rent control and can 
look forward to further progress, the time 
has not yet come for the final elimination 
of Federal rent control. 

The 8 million rental units which will still 
be under Federal control on June 30 are 
located in 40 States of the Union. Federal 
control will still be in effect in 63 of the 92 
cities with populations over 100,000 in the 
last census, as well as in thousands of our 
smaller cities, towns, and localities. Rent 
control will still be a national problem. The 
housing shortage will still be acute. 



265 



[93] Apr. 21 



Public Papers of the Presidents 



Despite the record volume of housing pro- 
duction in recent years, only in the past year 
or two have we begun to catch up on the 
accumulated shortage. But even the recent 
gains have been mainly in certain areas and 
for certain types of housing — not equally for 
all. The bulk of new construction since the 
war has been priced to meet the needs of the 
higher-income families. In large cities, new 
units suitable for families with children gen- 
erally rent for $85 a month or more. Hous- 
ing at rentals that families with incomes of 
less than $300 a month can aflord is still 
extremely scarce in most urban areas and in 
thousands of smaller communities. In 
many of the larger urban areas there are 
virtually no rental vacancies in livable dwell- 
ings. The situation is also particularly 
severe in smaller communities near military 
installations where the families of many 
married servicemen live. 

The housing legislation enacted by the 
Eighty-first Congress will help to meet these 
urgent housing needs. The Act passed in 

1949 initiated a broad new program of low- 
rent public housing. The Housing Act of 

1950 provides new incentives for privately 
financed homes for families of moderate in- 
come. Much of the additional housing 
made possible by these measures, however, 
will not be available for some time. Nor 
will these measures be as fully effective in 
meeting the needs of all our people as would 
have been the case if the Congress had 
adopted the cooperative middle-income hous- 
ing program which I proposed. Therefore, 
while there is every reason to expect steady 
progress in expanding the supply of housing, 
it will be some time before supply comes 
into reasonable balance with demand on a 
national basis. 

It is highly significant that every one of 
the 63 large cities still under Federal rent 
control on June 30, as well as each of the 
thousands of smaller communities covered, 



has had the option to remove controls but 
has chosen to retain them. The reason for 
their decision — and the wisdom of it — is 
clearly evident in the results of a Bureau of 
Labor Statistics survey of rent increases in 
14 cities where Federal rent controls were 
removed during 1949. Of these 14, all but 
one were decontrolled through State or local 
action; in two cases. State controls were sub- 
stituted. This survey shows that of those 
units whose rents were free to rise (exclud- 
ing those whose rents were controlled by 
lease and those which had been earlier de- 
controlled individually), the proportion of 
units having increases ranged from 17 to 
74 per cent, with 60 per cent or more in such 
large cities as Milwaukee, Dallas, Omaha, 
and Knoxville. Among units having in- 
creases, the average rise in rents ranged from 
12 per cent in Madison, where State law 
limited the amounts of increase permitted, 
to 41 per cent in Houston. In 8 of the 14 
cities, the average increase was over 25 
per cent. 

The survey also shows that the impact was 
heaviest on low-income groups. Among 
units renting for under $30 a month, the 
proportion having increases was greater than 
among higher-rent units. The average 
percentage increases were also markedly 
higher ranging up to 46 per cent in Houston, 
52 per cent in Wichita, and 56 per cent in 
Dallas. In 7 cities, the average increase was 
35 per cent or higher. 

These increases, I want to emphasize, oc- 
curred in cities where it was believed the 
housing shortage had been reduced enough 
to permit decontrol. There is every reason 
to assume that in other cities, and partic- 
ularly the largest ones, the effects of decon- 
trol at this time would be even more drastic. 
Chicago landlords, for example, argued in 
court last fall that they were entitled to a 
71.5 per cent rent increase. 

It is clear, therefore, that a sudden and 



266 



Harry S. Truman, ig^o 



Apr. 24 [94] 



simultaneous removal of rent controls on a 
national scale would precipitate a wave of 
exorbitant rent increases. Such increases 
would seriously reduce the purchasing power 
of millions of families. Since there are very 
few vacant livable housing quarters available 
for rent within the means of low and middle- 
income families, they would have no choice 
but to pay the rent increases demanded. 
These families are already living on tight 
budgets. The money to pay high rents 
would have to come out of their purchases 
of food, clothing, and other necessities. The 
burden would be most serious for the one- 
fourth of our families with incomes of less 
than $40 a week. 

A sudden and rapid increase in rents 
would affect adversely sales and employment 
in many industries and trades. In addition, 
public assistance costs would rise, increasing 



Federal, State and local budgets. Public 
and private pensions for the aged would be- 
come more inadequate. 

In contrast to the hardships and economic 
dislocations which would follow a sudden 
and premature termination of rent control, 
we have the sound alternative of continuing 
a policy which protects the tenant and at 
the same time is fair to the landlord. The 
welfare of our citizens as well as the stability 
of our national economy require that this 
policy be continued. I therefore urge that 
the Congress extend Federal rent control 
to June 30, 1 95 1. 

Harry S. Truman 

note: On June 23, 1950, the President signed the 
Housing and Rent Act of 1950 (64 Stat. 255), and 
on December 20, 1950, he signed a bill extending cer- 
tain provisions of the Housing and Rent Act of 1947 
until March 31, 1951 (64 Stat. 11 13). 



94 Address at a Dinner of die Federal Bar Association. 
April 24, 1950 



Mr, President, distinguished guests, members 
of the Federal Bar Association: 

I am delighted to be at this dinner tonight, 
and to join in commemorating the 30th an- 
niversary of the founding of this fine organi- 
zation of Federal lawyers. You know, you 
have an unusual representation of the Gov- 
ernment here tonight. You have the execu- 
tive branch, represented by the President and 
the members of his Cabinet. You have the 
Chief Justice and members of the greatest 
court on earth, representing the judicial 
branch of the Government, and you have 
the second most powerful man — sometimes I 
think he is the first most powerful man in 
the Government of the United States — in the 
Speaker of the House of Representatives, 
which represents the legislative branch of 
the Government. 



It would be rather hard for me to deny 
that I am friendly to lawyers. The record 
would speak against me if I should deny it. 

Six of the nine members of my Cabinet 
are lawyers. So are quite a few other top 
officials of the executive branch. 

When you couple this with the fact that 
over half of the House of Representatives and 
about two-thirds of the Senate are lawyers, 
as well as all our Federal judges of course, 
you can see that — so far as the Government 
of the United States is concerned — the legal 
profession is not just a passing fancy. It is 
probably here to stay. 

Our lawyers have a primary responsibility 
in the maintenance of justice. This is par- 
ticularly true of the Government lawyer, 
whose first devotion must be to the public 
interest. The public interest does not mean 



267 



[94] Apr. 24 



Public Papers of the Presidents 



only the interest of the Government. It 
means also the protection of the rights of 
individual citizens. 

Our concept of justice represents a basic 
difference between our system of government 
and that of the totalitarian states. Justice 
is the foundation of true democracy. Our 
system of justice preserves the freedom and 
dignity of the individual, and his right to 
think and speak as he feels and to worship 
as he pleases. It protects him in the asser- 
tion of his rights even against his own gov- 
ernment. It makes certain that his assertion 
of those rights will be fairly considered and 
justly decided. 

But there is in the world today a tyran- 
nical force which does not recognize justice 
as we know it. It is a force which crushes 
the minds and bodies of those under its 
control, and seeks to enlarge itself by aggres- 
sion and by false promises of freedom and 
economic security. 

Wherever this force extends, there is no 
freedom of speech, no freedom of religion, 
no freedom even of opinion. The state is 
the all-powerful arbiter of men's words and 
acts. Human dignity and human freedom 
are meaningless. 

Against this tyrannical force, which we 
know as communism, the United States 
stands as the great champion of freedom. 
Against this force, the United States has 
developed and put into effect a positive pro- 
gram to strengthen freedom and real democ- 
racy. Our program is shaped to strengthen 
the United States and to help other free 
nations protect themselves against aggression 
and subversion. 

Since the end of the war we have taken 
farseeing steps, unprecedented in the history 
of the world, to help other free nations re- 
build from the destruction of war and 
strengthen their democratic institutions. 
Our programs of foreign aid have made it 



possible for these free nations to resist Com- 
munist aggression. 

The Greek-Turkish aid program, the 
Marshall plan, the North Adantic Treaty, 
the military assistance program, and our 
support of the United Nations are the major 
elements in our central policy to work for a 
peaceful and a prosperous world. We Tiavc 
taken the leadership in aiding underdevel- 
oped areas, and in reducing trade barriers 
between nations. We are keeping our mili- 
tary forces strong and alert, and we are giv- 
ing meaning and strength to our joint 
defense arrangements with other countries. 

We have done all this because it represents 
enlightened self-interest. We know that the 
greatest threat to us does not come from the 
Communists in this country, where they are 
a noisy but small and universally despised 
group. The greatest threat comes from 
Communist imperialism abroad, where the 
center of its military and economic strength 
lies. The real danger is that communism 
might overrun other free nations and thus 
strengthen itself for an ultimate attack 
against us. 

But although communism is not a major 
force in this country, we are taking no 
chances on its becoming a strong force. 
On the one hand, we are working to create 
conditions in the United States in which 
communism cannot possibly thrive. On the 
other hand, we are striking hard blows at 
Communist subversion wherever it is found. 

We are vigorously pressing domestic pro- 
grams to improve the standard of living of 
our people, to assure equal opportunity for 
all, and to promote their health and educa- 
tion, and their security and freedom. These 
programs were not specifically designed as 
anti-Communist measures. We would have 
had them even if there were not a single 
Communist in the world. Nevertheless, 
they are among the strongest anti-Commu- 



268 



Harry S. Truman, ig^o 



Apr. 24 [94] 



nist weapons in our whole arsenal. 

Communism has little appeal for people 
who are healthy, well-educated, prosperous, 
and free. Moreover, there are few things 
that will do more to prevent the Communists 
from winning followers in other lands than 
a demonstration by the United States that 
democracy truly means a better, freer life 
for everybody. 

While we have been working to improve 
our democracy, we have been fully aware 
of the threat of Communist subversion with- 
in our own borders. Through the Federal 
Bureau of Investigation and our other secu- 
rity forces, through prosecutions in the courts 
by the Department of Justice, through our 
Federal employee loyalty program, and in 
many other ways, we have vigorously at- 
tacked Communists wherever their activities 
became a threat to our liberties. 

There has been so much confusion recently 
about who is doing what to defeat commu- 
nism in this country, that I think the record 
should be set straight. 

This administration has fought commu- 
nism with action and not with just words. 
We have carried on this fight with every 
law on the statute books, and we have rec- 
ommended new laws when we found they 
were necessary and could be framed without 
impairing the very freedoms we are seeking 
to protect. 

No known instance of Communist sub- 
version — or any other kind of subversion — 
has gone uninvestigated. 

No case where the facts warranted has 
gone unprosecuted. 

We have prosecuted and obtained convic- 
tion of 1 1 top-ranking members of the Com- 
munist Party in this country. We have suc- 
cessfully prosecuted many other persons for 
crimes related to communism. We have also 
prosecuted and obtained conviction of a 
large number of alleged Communists on 



charges of contempt for refusing to testify 
before Federal grand juries or congressional 
committees. And those prosecutions have 
been carried on by the Attorney General's 
office in the executive part of the Govern- 
ment. 

We now have under investigation the cases 
of over 1,000 citizens to determine whether 
steps should be taken to revoke their citi- 
zenship on grounds involving subversive 
activities. One hundred and thirty-eight per- 
sons are under orders of deportation on 
grounds involving communism. 

There